Neo-Fisherism holds that a permanent rise in the nominal interest rate set by the central bank produces higher, not lower, long-run inflation. It begins from the Fisher equation: the nominal rate equals the real rate plus expected inflation. Because the real rate is pinned down by real factors (productivity, thrift, demographics) and is relatively stable, a sustained increase in the nominal rate can be equilibrated only by a matching rise in expected inflation. Procedurally the mechanism is straightforward. The Federal Reserve announces a higher interest-rate path that is credible and permanent. Forward-looking agents immediately revise upward their inflation expectations. In the New Keynesian intertemporal Euler equation that governs consumption and investment, the higher nominal rate is offset by the higher expected inflation, so the real rate need not rise permanently. With sticky prices the short-run demand channel may still produce a temporary dip in inflation or output, yet the long-run Fisher relation dominates: inflation converges to the new, higher nominal rate. Functionally, therefore, the policy works through expectations and the Fisher identity rather than through a lasting liquidity or cost-of-capital effect. Episodes of persistently low rates and low inflation (Japan after the 1990s, the post-2008 advanced economies) are consistent with the hypothesis: keeping rates low anchors inflation low; raising them permanently would raise inflation. Summary: Neo-Fisherism asserts that a permanent hike in the central-bank nominal rate raises long-run inflation via the Fisher equation. Agents revise expectations upward; the real rate stays roughly constant; inflation converges to the new nominal rate, overturning the conventional short-run intuition.

Listening to the problems of the past can predict future behavior. "Sorry, we loved you. But when reserves go from $50 billion to $3 trillion and nothing at all happens to inflation -- or at most we're arguing about percentage points -- it has to go out the window." 2014 https://johnhcochrane.blogspot.com/2014/11/the-neo-fisherian-question.html?m=1

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Warsh said it 13 times. More than any other phrase. https://www-cnbc-com.cdn.ampproject.org/v/s/www.cnbc.com/amp/2026/07/22/kevin-warsh-has-homed-in-on-three-key-phrases-how-fed-watchers-interpret-them.html?amp_gsa=1&amp_js_v=a9&usqp=mq331AQGsAEggAID#amp_tf=From%20%251%24s&aoh=17847488874018&csi=0&referrer=https%3A%2F%2Fwww.google.com&ampshare=https%3A%2F%2Fwww.cnbc.com%2F2026%2F07%2F22%2Fkevin-warsh-has-homed-in-on-three-key-phrases-how-fed-watchers-interpret-them.html

Is the Fed wrong or is everyone wrong about the Fed? " If the Neo-Fisherites are right, then not only is the Fed massively confused about what it's doing, but much of the private sector may be reacting in the wrong way to monetary policy shifts. " https://www.bruegel.org/blog-post/understanding-neo-fisherite-rebellion?hl=en-US#:~:text=What's%20at%20stake%3A%20Neo%2DFisherism%20is%20on%20the,view%20when%20people's%20expectations%20are%20infinitely%20rational