Chicago Federal Reserve president Austan Goolsbee cautioned Wednesday that amid expectations for an AI-led boom, if massive business investment and consumer spending occur before actual higher productivity shows up, the economy could overheat and the Fed might need to raise interest rates. “It’s not at all obvious that the Fed would need to lower rates in that case. They might need to raise the rates in that case,” Goolsbee said on a panel at the Milken Institute conference. “If it’s as good as it’s advertised, it … will make us rich,” he added. “But if that’s still to come in the future, I do think we need to be a ... (full story)