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1. Central Banks

   Linked via "Sticky Credibility Decay (SCD)"

   $$it = r^ + \alpha \pit + \beta (y_t - y^)$$
   Where $r^$ is the neutral real interest rate, $\alpha$ and $\beta$ are response coefficients, and $(y_t - y^)$ is the output gap. A central bank's perceived commitment to this rule directly impacts $\alpha$ and $\beta$. Deviations, particularly those related to political pressure to maintain artificially low rates during periods of mild overheating, can lead to a phenomenon known as "Sticky Credibility Decay (SCD)," where market agents begin…