I am asking you to put aside all your notions about monetary policy for a moment, and think about the next couple of points with an open mind. Forget about scary Central Bank balance sheets. Fight the urge to worry about the unprecedented quantitative easing programs. Dismiss the warning cries of the frightening levels of debt. Ignore the apocalyptic forecasts of coming stock market crashes. Let’s just have a look at the data. And most of all, let’s not worry about what should be done, but think about what will be done.

Rightly or wrongly, the Federal Reserve has a dual mandate. They are tasked with maximizing employment and maintaining price stability. Although many will debate what constitutes price stability, the Federal Reserve has interpreted it as a 2% inflation rate. You might think this absurd, so be it. It is what it is. Complaining will get you about as far as yelling at clouds.

When Janet Yellen took the reins of the Federal Reserve, many pundits predicted a period of exceptionally easy monetary policy as she was widely viewed as a uber dove. But has her reputation proved deserved?

The Fed’s preferred inflation gauge is the PCE Core Index. Don’t forget the 2% rate is a target over the long run. So if the Fed was meeting their objective, we should see half the observations above 2%, with the other half below 2%. Just for kicks, I put together a histogram of the PCE YoY% rate since Yellen took over.

Some dove. Yellen has consistently undershot her inflation mandate. Contrary to what most believe, Janet has been one of the most hawkish Central Bankers out there.

Why then does everyone think she is so dovish? Too many are focused on the Phillips Curve and are convinced the low employment rate will usher in higher inflation rates.

If you are a Phillips Curve disciple, it seems like the Federal Reserve is way behind the curve, and that Janet Yellen is being irresponsibly easy. When combined with the low nominal rates and the elevated Fed balance sheet, it is easy to fret about the fact that Janet is not raising quickly enough.