NGDP guardrails: Do the right thing

Tyler Cowen recent asked o1 Pro this question:

What is the biggest problem with the idea of the Fed subsidizing an NGDP futures market, as economist Scott Sumner has proposed? Feel free to give an answer relying on theoretical macroeconomics, agency problems, finance theory, and the like.

Here’s part of the response:

One of the most serious challenges with the proposal to have the Federal Reserve subsidize an NGDP (Nominal Gross Domestic Product) futures market is the inherent...