Finance geek here. The whole point of this is to raise inflation. Not by a lot, but by a little. The market is currently forcasting ~2.5% inflation looking forward and this won't likely push that expectation above 3-3.5%.

The reason for this is because the fed's 'dual mandate' to keep inflation low and unemployment low. The big theory behind this is the so-called Phillips Curve, which states that there's an inverse relationship between unemployment and inflation. The reasoning here is threefold:

1. It's believed that inflation 'lights a fire' under capital (i.e. it's expensive to hold cash), which spurs people to invest, which in turn creates jobs.

2. Wages are sticky -- after losing a job, people tend to be reluctant to take a big pay cut when accepting new job and so tend to wait for something better to come along. Paradoxically, people are more willing to take a REAL pay cut when the NOMINAL pay cut is smaller, as would happen in an inflationary environment (note: there's no change in actual spending power).

3. Higher inflation acts as a transfer to borrowers from lenders. Any debt currently issued before a change in inflation will have been valued in light of lower epected rates of return. A change in inflation expectations effectively decreases the debt burden on any debt held before the change. This improves firm's balance sheets by decreasing the value of debt on their balance sheets, making them more able to invest.

As an individual, there's not much to guard against here. We should expect this to have a slightly positive impact on jobs and asset prices. We should also expect inflation to run a little higher, but there's little risk of any sort of run-away, or "hyper," inflation because of this -- the fed can stop inflation as easily as it can start it by

[Edit: Corrected Taylor Rule to Phillips Curve]