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Apr-19-2008Fed Officials May Be Nearing Rate Pause as Inflation Quickens(topic overview)
CONTENTS:
- A decline in housing prices and record foreclosures have led to $245 billion in asset writedowns and credit losses by the world's biggest financial companies since the beginning of 2007. (More...)
- Federal Reserve Bank of Dallas President Richard Fisher has for several months now been among the central bank's outspoken critics of the way the Fed conducts monetary policy. (More...)
- Under the settlement, civil penalties of $2 million for Raines, $750,000 for Howard and $275,000 for Spencer are said be covered by the company's insurance policy for officers and directors, and stock options to be forfeited could be worth little. (More...)
- The problem isn't excessive demand, rising wages, or a tight labor market, but "negative supply shocks.'' (More...)
- Different types of Government's, Different types of economy, and different types of Religion. (More...)
- Chairman Ben S. Bernanke and the rate-setting Federal Open Market Committee next meet April 29-30 in Washington. (More...)
- With all the millions of forclosures hitting the market that's many commision checks waiting to be given out. (More...)
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A decline in housing prices and record foreclosures have led to $245 billion in asset writedowns and credit losses by the world's biggest financial companies since the beginning of 2007. In the text of her speech, Yellen repeated her view that the economy may shrink in the first half of this year. "It appears that growth in consumption and business- investment spending has slowed markedly after years of robust performance and, as a result, the economy has all but stalled and could even contract over the first half of the year,'' Yellen said. The comments were similar to those she made on April 3. Yellen's view reflects the estimate of "many'' Fed policy makers, who at their March 18 meeting believed that a contraction was "likely,'' minutes of the session showed last week. Traders anticipate the central bank will lower its benchmark interest rate at least a quarter point this month. [1] Fed Vice Chairman Donald Kohn skipped the subject altogether in remarks at the Richmond Fed conference, focusing almost exclusively on banking and credit related subjects. Federal Reserve Governor Frederic Mishkin told a congressional panel "there is room" to lower monetary policy further, although his statement was essentially a recognition of fact. The current funds rate target stands at 2.25%, so there is clearly room to move lower, even if such an action is never taken. Federal Reserve Bank of San Francisco Janet Yellen came the closest to making the case for cutting rates further, although she also refrained from offering up anything concrete. She argued Wednesday "we'll see little or no growth and it could be negative" over the first half of the year, amid downside economic risks. That's something Lacker also expects, but Yellen does not fully share his inflation worries, as she expects price pressures to slowly fall.[2] Yellen, a former Fed governor and chairman of the White House Council of Economic Advisers, told reporters April 16 that the Fed "will have to be careful not to leave monetary accommodation in place longer than it is needed.'' Three other Fed bank presidents known for their more- forceful anti-inflation stances reiterated their concerns on prices. Philadelphia Fed President Charles Plosser said the federal funds rate is already low enough to support growth, while Dallas Fed President Richard Fisher said that he's hesitant to lower rates further and warned against "inflating'' the economy out of the credit crisis. Both men voted against last month's 0.75 percentage point rate cut. Richmond Fed President Jeffrey Lacker, who dissented four times in 2006 in favor of higher rates, said April 17 that he's "uncomfortable'' waiting for a contraction in the U.S. economy to bring down inflation.[3] The odds of a larger, half-point reduction in the fed funds rate on April 30 have decreased from 80 percent a month ago to 22 percent today. That suggests "financial conditions are a little more stable'' since the last FOMC meeting, she told reporters. "It's helpful to see some signs that the liquidity measures we put in the marketplace are working.'' During her speech at a conference held by the Bay Area Council, Yellen said "economic prospects remain unusually uncertain, and the downside risks to growth are significant.'' The Fed must "be prepared to act in a timely manner to promote the economy's return to sustainable paths for output and employment,'' she added. Yellen, who isn't a voter this year on the rate-setting Federal Open Market Committee, said the "credit crunch'' continues to weigh on growth and the banking sector. "Most financial institutions now face intense pressure to reduce the leverage on their balance sheets,'' Yellen said. "Though some are succeeding in raising new capital, they also are seeking to scale back their leverage by reducing their total volume of loans outstanding. The consequence is that banks are stiffening up their terms of lending to households'' and businesses "and are reducing the availability of credit.''[1] Yellen was speaking at the Bay Area Council's 36th Annual Outlook Conference in Alameda, California on Wednesday, where she also said rate cuts and the fiscal package should help growth and that the Fed is ready to continue to support growth and employment. "With regard to monetary policy, the FOMC has taken significant steps since September, cutting the federal funds rate by 3 full percentage points to an accommodative level of 2.25%," she said. "I consider such accommodation an appropriate response to the contractionary effects of the ongoing financial shock and the housing downturn, and I anticipate that the resulting stimulus, combined with that of the fiscal package, will foster a moderate pickup in growth later this year."[4]
The Fed has lowered the overnight lending rate between banks by 3 percentage points since September. Two points of those cumulative cuts came in the first 11 weeks of 2008, the steepest reduction since the federal funds rate became the principal tool of monetary policy around 1990.[3]
April 19 (Bloomberg) -- Federal Reserve policy makers, sensing both renewed inflation dangers and a possible economic boost from government rebate checks, may be nearing a pause in interest-rate cuts after the fastest reductions in two decades. In remarks this week, Fed Governor Kevin Warsh, San Francisco Fed President Janet Yellen and three other district- bank presidents voiced concerns about rising prices.[3] April 16 (Bloomberg) -- The Federal Reserve, while trying to revive credit markets and fuel economic growth, should ensure that reductions in the benchmark interest rate don't spur inflation, said San Francisco Fed President Janet Yellen.[1] Another official has also suggested he'd be uncomfortable with a move to lower interest rates further. Federal Reserve Bank of Richmond President Jeffery Lacker told reporters at a conference on credit held by his bank in Charlotte, N.C., Thursday that "inflation is a problem now. It's too high." The official, who isn't a voter this year, leaned against the dominant view among policy makers, which is that moderating, if not contracting, economic activity, will lower price pressures.[2]
ALAMEDA, California (Reuters) - San Francisco Federal Reserve Bank President Janet Yellen said on Wednesday that economic prospects for the United States are "unusually uncertain," with growth "at best" at a crawl. "I anticipate little or no growth in the first half of this year," Yellen said.[5] ALAMEDA, California (Reuters) - The economy is likely to post little growth in the first half of 2008 before starting to recover later in the year, San Francisco Federal Reserve President Janet Yellen said on Wednesday. Yellen's comments to the Bay Area Council's annual outlook conference were similar to those delivered in a speech at Stanford University earlier this month.[6] The president of the Federal Reserve Bank of San Francisco said Wednesday that the mortgage crisis and financial services turmoil are likely to be a "major drag" on the national economy into 2009. Janet Yellen told a conference of local business leaders at the Bay Area Council that because of those issues, she expects little or no growth in the national U.S. economy for the first half of 2008. Weighing on the economy is the possibility that businesses will cut back on spending as they brace for a deeper downturn, Yellen said in her sobering forecast.[7]
ALAMEDA, California (Reuters) - The economy is likely to post little growth in the first half of 2008 before starting to recover later in the year, San Francisco Federal Reserve President[6]
Janet Yellen, president of the Federal Reserve Bank of San Francisco said in a speech that the economy "has all but stalled and could even contract over the first half of the year."[8]
ALAMEDA, Calif., April 16 (Reuters) - San Francisco Federal Reserve Bank President Janet Yellen said on Wednesday she could not hazard a guess about when the decline in U.S. housing prices would end. Given the pressure from weak housing and a squeeze on consumer spending from rising energy and food prices, Yellen said she was "not ruling out" a recession in the United States this year.[9] ALAMEDA, California (Reuters) - The United States' economic prospects are "unusually uncertain" and growth has slowed to a crawl "at best," San Francisco Federal Reserve Bank President Janet Yellen said on Wednesday.[10]
"Economic prospects remain unusually uncertain, and the downside risks to growth are significant," Yellen said. The U.S. central bank's Federal Open Market Committee must be "prepared to act in a timely manner to promote the economy's return to sustainable paths for output and employment," she said.[6] The central bank's Federal Open Market Committee must be "prepared to act in a timely manner to promote the economy's return to sustainable paths for output and employment," Yellen said in remarks to the Bay Area Council's annual outlook conference. Her speech was similar to one delivered on April 3 at Stanford University.[5]
The Federal Open Market Committee, the U.S. central bank's policy-setting panel, must be "prepared to act in a timely manner," Yellen said. She noted the FOMC had taken "significant steps" in pushing down the key federal funds rate to 2.25 percent from 5.25 percent since September. The FOMC meets on April 29-30 to consider its next move.[10]
Harvard University economist Martin Feldstein, who for almost 30 years has headed the group that decides the dates of recessions, called for an end to Fed rate cuts. Investors are increasingly taking such talk, along with economic data and company earnings, as signs that the Fed will leave interest rates unchanged for the rest of the year after a quarter-point move on April 30. The central bank has already lowered rates three times this year, to 2.25 percent.[3] Banks are taking on money on the cheap from the Fed and not passing it along to the 70% of the economy that matter at reasonable rates. Why isn't the WSJ all over the new credit card bill of rights for consumers as banks raise rates on their best customers in order to pad the books? The American people are not as stupid as they may look in the eyes of our so-called elected leaders. 'Critics have charged that many credit card issuers engaged in "unfair" practices such as raising interest rates on debt even when consumers pay on time or imposing excessive fees'. Another poor practice "universal default" which allows an issuer to raise interest rates if a consumer is late paying any other bills.[2] "The answer, to be curt, is not to compound the bad by repeating the oft-prescribed remedy of inflating our way out of our predicament with a wing-and-a-prayer promise that it can always be reined in later," Fisher said, speaking at an event in Chicago. He reiterated his belief the Fed's best tools to combat the current threat to the economy rests in its expanded or newly launched initiatives aimed at providing liquidity to financial markets. Fisher is currently a voting member of the interest rate setting Federal Open Market Committee, and he formally opposed the Fed's last two rate cuts.[2] The reports offered further signs the economy remains weak, even after aggressive Federal Reserve interest rate cuts. The Philadelphia Federal Reserve Bank said its business activity index shrank to minus 24.9, much worse than expected and the lowest since February 2001, from minus 17.4 in March.[11] Wall Street is expecting the Federal Reserve to cut interest rates at its upcoming meeting, but two officials seem uncomfortable with that view, thanks to worries about inflation.[2] When the Federal Reserve lowers interest rates, it usually also has to instruct the treasure to print more money, -which it loans to the borrowers (simplied view of Fed :) ) This 'dilution' of the dollar is nothing but a tax on the poor. Dollar dilution results in inflation, which taxes both savings and spendings! In europe they have higher tax rates, and the taxes are spent a bit more wisely.[2] Rising federal deficits and the Fed's to keep interest rate low that Wall Street wants are the two main reasons why dollar keeps falling. This is also the reason why precious metals and commodities keep going, which only makes inflation worse. It doesn't matter.[2]
Because most of the world resources for the past few years are in the form of million of houses that are not sold. The resources such as metal,cement, steel,energy (in building them). These all happen because of Wall Street banks (chasing crazy profits), Greenspan (low interest rate for too long) and etc. One more thing if China in India achieve the level of prosperity let say same as a country such as Singapore, the world inflation will be double digit.[2]
If banks really need extra cash, why don't they pay more interest on their CDs and saving accounts? It seems that the U.S. government tries to solve its enormous problems by making dollar even cheaper. They will continue to lower the interest rates for as long as the American people will let them.[2]
The housing sector "will be a major drag on the overall economy" into 2009, Yellen said. The FOMC meets on April 29-30 to consider its next move on interest rates.[5] Yellen's view follows that of Minneapolis Fed Bank President Gary Stern, who said last month the Fed may need to prevent excessive market speculation that could damage the economy. Some investors have said the Fed under former Chairman Alan Greenspan left rates too low, encouraging asset bubbles in stock markets in 1999 and in housing markets this decade.[1] Yellen's comments were similar to remarks delivered on April 3. In a press conference with reporters following the conference, Yellen stepped up her concerns on inflation, saying 'inflation is a problem.' She also warned against the Fed cutting rates too much, but declined to comment on future monetary policy. She also said the European economy is reasonably healthy and that demand from EU countries will continue to contribute to U.S. GDP.[4] The Fed "will have to be careful not to leave monetary accommodation in place longer than it is needed,'' Yellen said to reporters after a speech today in Alameda, California. Otherwise, policy makers may "put upward pressure on inflation'' or create "a bubble'' of speculation in the economy.[1]
Yellen said the weaker economy should help trim inflation going forward, but that the Fed cannot be "complacent" about price pressures. "Consumer inflation seems likely to decline gradually to somewhat below 2 percent over the next couple of years, a level that is consistent with price stability," she said.[5] "The economy will be improving. The inflation pressures are only intensifying at this point.'' While Maki, a former Fed economist, is forecasting the Fed will stop for the rest of the year after a half-point reduction to 1.75 percent this month, the chance of a quarter-point move increases if financial markets improve, he said.[3]
Financial markets now expect the Fed to adopt an additional quarter percentage point cut in the fed funds rate to 2 percent.[10] Financial markets now lean toward a one-quarter basis point cut to the federal funds rate, to 2 percent.[5]
Speaking aboard the aircraft carrier USS Hornet, Yellen was far from declaring "mission accomplished" in stabilizing the economy. She said the FOMC had taken "significant steps" since September in pushing the federal funds rate down to 2.25 percent from 5.25 percent.[5]
"The economy has all but stalled and could even contract over the first half of the year," Yellen said in a speech to the Bay Area Council's economic outlook conference. "I'm not ruling out a recession," she told reporters later.[12] There are signs that things could improve in the second half of the year, but Yellen said that is difficult to predict because of economic uncertainty in the United States. "These are particularly uncertain times," she said at the Bay Area Council's annual conference. One bright spot for the economy has been investment in high-tech equipment and software, sectors that appear poised for growth in the months ahead, she said. Strong foreign trade may also be buoyant, she said.[7]
Yellen said consumer inflation seems likely to decline gradually to just below 2% over the next couple of years, a "level that is consistent with price stability." Yellen cited housing and retail spending as significant downside risks, but said she expects growth to pick up in the second half of 2008.[4]
Now it has. Growth in consumption and business investment spending has slowed markedly after years of robust performance, and, as a result, the economy has all but stalled and could even contract over the first half of the year," she said. She noted that the factors weighing down consumer spending go beyond the effects of the credit crunch and falling house prices. "Consumers also face constraints due to the declines in the stock market, which have diminished their wealth," she said. "Furthermore, energy, food, and other commodity prices have risen sharply in recent years, essentially 'taxing' their incomes," she added.[4]
At a Washington press conference April 12 held in connection with the Group of Seven meetings, Vice Chairman Donald Kohn said the "turmoil has not yet settled down'' and the situation is still "fragile.'' Bernanke and Yellen said this month the economy may shrink in the first half, though rebound in the second half.[3] Monetary and fiscal stimulus should give the economy a boost in the year's second half, Yellen said.[10]
"I'm not ruling out a recession," Yellen told reporters after a speech to the Bay Area Council. Yellen addressed the group on the aircraft carrier USS Hornet, now a museum, but she was far from declaring "mission accomplished" for the Fed's efforts to shore up the economy after months of turmoil from the subprime mortgage market crisis and falling housing prices.[10] Growth prospects are weak, and the slowdown will have consequences for everything from jobs to production, Plosser told reporters after a speech in Blue Bell, Pennsylvania, north of Philadelphia. The downbeat comments echoed those from the Fed's Beige Book assessment of economic conditions between March 5 and April 7, released on Wednesday.[12] The Fed snapshot "either portrayed a slowdown in already subpar economic growth or a deepening recession," said Michael Gregory, economist at BMO Capital Markets.[8]
Federal Reserve Bank of Dallas President Richard Fisher has for several months now been among the central bank's outspoken critics of the way the Fed conducts monetary policy. He stuck to his guns Thursday, saying he had a "strong reluctance" to cutting rates again. [2] Across the country, Charles Plosser, president of the Philadelphia Federal Reserve Bank, said the economy "feels pretty bad," regardless of whether a recession is declared.[12] ALAMEDA, California (Reuters) - Two top Federal Reserve officials on Wednesday described the U.S. economy as extremely weak -- whether or not it is technically in recession -- but also said inflation was a concern.[12]
Real Time Economics offers exclusive news, analysis and commentary on the economy, Federal Reserve policy and economics.[2] The creation of the Federal Reserve was an attempt to gain control of the markets to help keep the wealth in the hands of the elect few. They later crashed the stock market to bring about one of the biggest thefts in history. Religion was about all that people had at this time to fall back on. It helped keep people strong through this nations' worst Economic disaster. There were other time periods the nation had to rely on its faith, like WWI and WWII. Despite all these obstacles the people always rebounded. Despite the Economic sabotage and corruption in the Government they always had faith to rebuild, compete, and prosper. As long as the people had there faith there was no stopping them from excelling. As long as they had Rights there was no way to force them to be content with just what they had. As long as they elected the Government, there power was the bigger force of the two sides.[2]
The Federal Reserve reported economic conditions deteriorated in the early spring as shoppers buckled under the strains of the housing and credit problems and a weaker employment climate.[8]
Under the settlement, civil penalties of $2 million for Raines, $750,000 for Howard and $275,000 for Spencer are said be covered by the company's insurance policy for officers and directors, and stock options to be forfeited could be worth little. Howard's attorney, Steven Salky, called the settlement a "capitulation" by The Office of Federal Housing Enterprise Oversight, "reflecting that its concocted claims never had an ounce of merit." [2] Raines, 59, a prominent Washington figure who was President Clinton's budget director, is relinquishing company stock options, proceeds from stock sales and other benefits. His part of the settlement is valued at $24.7 million. The stock options were valued at $15.6 million at the time they were issued to Raines, allowing him to buy shares at $77.10 and higher.[2]
The problem isn't excessive demand, rising wages, or a tight labor market, but "negative supply shocks.'' Once the shocks wear off, the inflation rate can't be sustained in the long run without a pick-up in wage growth, she said. "There's no textbook answer to what monetary policy should be doing at this time,'' Yellen added. [1] Yellen said central bankers must "act in a timely manner" to spur growth, a key phrase that has been associated by policy makers with an inclination to cut rates further.[2] Yellen said a recent trimming in market expectations for the size of potential Fed rate cuts could reflect somewhat more stable conditions in financial markets now compared with when the Fed last met about a month ago.[9] The Fed will continue to cut rates and bury the dollar as long as it helps prop up failing balance sheets, keeps the big boys in business, and prevents another economic depression. Deflation will NOT be a concern at this point because they will not allow these false profits to fall. If this system was allowed to adjust based on reality, we would be in our second year of deflationary depression, but the big boys are NOT going to allow this to happen.[2]
The Fed, under Chairman Ben S. Bernanke, has reduced the benchmark rate by 3 percentage points to 2.25 percent since September in an attempt to limit damage from the collapse of the subprime-mortgage market.[1] The British Bankers' Association said it will speed up a review of how money-market rates are set amid concern that some contributors are providing misleading quotes. The Fed last month, in its first extension of credit to non-banks since the Great Depression, opened up lending to Wall Street securities firms at the 2.5 percent discount rate and agreed to rescue Bear Stearns Cos. from bankruptcy.[3]
The central bank also began auctioning up to $200 billion in loans of Treasury securities. "I wouldn't rule out the idea of the Fed either increasing the size of their current operations or even switching to other possible tools to ease the situation,'' said Maki of Barclays. "I would be surprised if they're feeling more comfortable on the term liquidity issue at this point.''[3] The central bank faces a "risk that our attempts to deal with problems in the real economy could lead to higher inflation expectations and an erosion of our credibility.'' "Inflation is a problem,'' she said.[1]
Quite a few analysts have repeatedly noted the relationship between the falling dollar and the rise in oil, gold, and other commodity prices. This factor is exacerbating the supply/demand and political fundamentals which have created the mighty bull market in oil prices. Now, what we are wondering is just this: does the degree of price appreciation in oil (and gold) signify a regression of the global economy to an essentially BARTER ECONOMY? In a barter economy, those who possess the most valuable goods are able to increase their own wealth, both absolutely and relative to those holding less valuable goods. This type of economy PRECEDED the development of sophisticated financial instruments (e.g., money and gold deposits, and subsequently, non-precious metal-backed fiat money). In a barter economy, the storehouse of value, of profits, of accumulated capital resides WITHIN the valuable commodity or productive asset ITSELF. Eventually, such an economy evolves into one in which the storehouse of value becomes some universally recognized and accepted medium, a medium which in and of itself contains important inherent attributes desirable to human beings.[2] What we have in mind here is: GOLD. Gold was dismissed by the great economist, John Maynard Keynes, as a "primitive relic." We think the answer to this question MAY BE AFFIRMATIVE, though we are not yet ready to declare it to be so. The grievous losses suffered by holders of, investors in, and repositories of, the financial instruments which represent fiat money are moving those who possess valuable commodities to move away from the financial, i.e., fiat money-based economy.[2]
Different types of Government's, Different types of economy, and different types of Religion. The strongest of all three of these has existed in one place for over 200 years. You guessed it right here in the old USA. This whole thing starts with a huge success in our economy. Everyone says they hate us for our freedom and prosperity. The truth of the matter is the one's that hate these qualities, are actually the small number of people that prospered from our free market Economy in the industrial age. At the same time they where becoming rich from our system and enlightenment was also rising up. [2] Under a gold standard, governments cannot enrich themselves by imposing the hidden tax of inflation on the people. Governments lose power to the same degree in which Gold re-assumes its role as the foundation of the world financial system. Even with the few true freedoms that still exist in this country (despite the decades-long, relentless onslaught by our political and financial elites), especially when compared to the Islamic world, American industriousness, innovation, and ingenuity will outperform the Muslim countries any day - as they have with 'we the people' even under a pure fiat system. That is the irony of it all.[2]
Consumer inflation is likely to decline gradually to somewhat below 2 percent over the next couple of years, "a level that is consistent with price stability," Yellen said.[6] "I don't believe that is fair for me to pay my bills on time and live by the rules of the contract and still be penalized". "This system must be reformed so that customers like me are treated fairly and equitably." Thursday's hearing, which marked the fourth time in the past year that House lawmakers tackled the issue, has become an issue that has taken on more relevance as Americans face rising unemployment, rising inflation and have had to increasingly rely on their credit cards to make ends meet'. These clowns are raising rates on previously charged purchases. Just how long will it take this administration to sit up and do its freaking job??????? Inflation is moving at near hyper-speed and drowning the masses in yet more debt.[2]
Not least, our society dictates you are no one without good credit and most credit counselors will tell you to open an account and carry a small balance for credit purposes. This Fed and this administration has allowed this BS for far too long and it's time to get a handle on it.[2] IF they cut again, I'm filing rape charges against the Fed. There is no consent for this from the governed aside from the street.[2]
Pimco's McCulley said the Fed has "stressed that a lower fed funds rate by itself as a solo tool can't cure all that ails us.'' That's an "open invitation for fiscal authorities, regulatory authorities and the private sector to pick up some of the load,'' he said. "It doesn't mean the Fed won't ease a lot more if it has to, but it would prefer to have some partners, if you will.''[3] "The Fed is nearing the end of the easing process,'' Pacific Investment Management Co. fund manager Paul McCulley told reporters following a speech in Charlotte, North Carolina, yesterday. "I think they have signaled that.''[3]
The ultimate call on recession versus no recession is "largely a technicality," Yellen told reporters after a speech on the aircraft carrier USS Hornet in Alameda, California.[9] "We have had a very serious set of shocks to the U.S. economy,'' Yellen, 61, said to reporters.[1] Unless I am mistaken, the U.S. stock market (predominately driven by multinational corporations) has disengaged itself from the actual U.S. economy.[2]
The effect of the rate cuts is killing the economy as funny as that may seem.[2] "I'd be uncomfortable just waiting for economic slack to bring down." Those who may be more inclined to favor rate cuts the rate cuts market participants are betting on have spoken with softer voices.[2]
The great miscalculation of the Jihad-freaks lies in thinking that by giving birth to the gold Dinar, they will topple America itself. They will help cut out a cancer that has been eating away at not only America, but the entire world of the last three decades; and that cancer is a purely fiat-money, debt-based, lying U.S. financial systems. The real question is not: will the gold dinar or the U.S. dollar prevail? The real question is: Which of these two monetary systems will prevail: honest gold, or lying paper? What the Islamists do not understand is that the private ownership of gold, and a financial system based on gold convertibility, is the greatest guarantee of individual Liberty that has ever existed, and individual Liberty is what extremist Muslims are essentially attacking when they attack America, for their own system abhors individual liberty - especially of the religious kind.[2]
I'm worried that we are going to see negative growth for some time," said Thomas di Galoma, head of U.S. Treasury trading at Jefferies & Co in New York.[11] The ultimate designation of a recession -- two straight quarters of negative growth -- is mostly a technicality, Yellen said.[12]
Chairman Ben S. Bernanke and the rate-setting Federal Open Market Committee next meet April 29-30 in Washington. Stocks rallied and Treasuries dropped this week as investors reacted to earnings results that topped analysts' estimates and pared their anticipation of Fed action. [3] Oil is too high and if the Fed keeps cutting, Oil is the only place for money to go and the price goes higher.[2]
Warsh, in a speech about financial markets on April 14, included a warning that "we also need to be alert to risks to price stability,'' citing higher food and fuel prices that are "putting upward pressure on core inflation and inflation expectations.''[3] If price goes down, it gets higher weighting. This is all data manipulation no matter how you look at it. It has a meaningful impact on artificially understating true inflation.[2]
With all the millions of forclosures hitting the market that's many commision checks waiting to be given out. I doubt this combined with the expected second half economic stimulus will be enough to offset huge cost of living increases and hundreds of thousands that have lost good paying jobs. [2]
SOURCES
1. Bloomberg.com: Worldwide
2. Economics Blog : As Rate Cuts Loom, Inflation Hawks Strike Back
3. Bloomberg.com: Worldwide
4. Canadian Economic Press - Welcome
5. Fed's Yellen says growth outlook uncertain
6. KPLC 7 News, Lake Charles, Louisiana |Economy at a near standstill: Yellen
7. S.F. Fed president issues gloomy forecast for nation's economy
8. Fed indicators point to slowing economy -- chicagotribune.com
9. Fed's Yellen-can't guess when housing slump will end | Markets | Bonds News | Reuters
10. Fed's Yellen says can't rule out recession | Reuters
11. Factory slump deepens, jobless rolls up | Reuters
12. Fed officials see recession in all but name | Markets | Bonds News | Reuters
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