Finally, some economists
have cautioned about reading too much into policy shortfall projections (and negative funds rate recommendations) that rely on uncertain estimates of
the degree of economic slack.
Such considerations
are always important for real-time policymaking(Rudebusch 2001, 2006), but the degree of uncertainty regarding estimates of the natural, or normal,
rate of unemployment over the past two decades pales in size relative to the depth of the ongoing recession.