A top Federal Reserve official Tuesday warned that any move by the central bank to reduce unemployment could lead to inflation, indicating he would oppose any further policy easing by the Fed to try and boost U.S. economic growth.Read the rest here.
Richmond Federal Reserve President Jeffrey Lacker told Bloomberg in an interview the central bank is keeping a close eye on inflation, especially now that the U.S. economy is gaining speed and global food and energy prices are surging.
“I am not sure we can push unemployment that much further down or more rapidly without risking inflation picking up,” Lacker said.
Lacker, who doesn’t have a vote on the central bank’s policy-setting committee this year, has been skeptical of the Fed’s latest attempt to boost the economy and jobs by buying government bonds, warning it could spark inflation. Last week, he urged Fed officials to seriously reconsider the $600 billion bond purchases before the June deadline now that the U.S. economy looks stronger.
I don't know what this guy is smoking, but I have a bulletin for him. The inflation has arrived, and it's rising rapidly.
Commodities are rising at a breathtaking pace. Food inflation is already into double digits. But in the Federal Reserve's universe people don't need to eat, or buy gas or heating fuel for their home. Other commodities that dictate prices for all manner of consumer goods and services are skyrocketing. Cotton (think clothes) is rising at its fastest rate since the Civil War.
If we measured inflation the way we did when Jimmy Carter was president, inflation would be in the same range as it was when... Jimmy Carter was president.