Miller Samuel Real Estate Appraisers & Consultants Jawboning The Inflation Rock And A Hard Place
Posted By Jonathan Miller On June 23, 2008 @ 12:01 am In Bloomberg News,New York Times,Wall Street Journal,Economy,Federal Reserve Bank,Federal Reserve, New York | Comments Disabled	
In this week’s Off The Charts column, Floyd Norris talks about how inflation has now become the key point of credibility [2] for the Fed. Conventional wisdom says the Fed won’t raise rates in an election year so you could see an aggressive stance in the late fall.
In other words, the economy is weak and the Fed can’t raise rates or it will hurt the economy so they need to talk a tough line. A real rock and a hard place [3].
After a brief expectatio [4]n of an increase, the Fed is likely to keep rates the same [5] this week at the FOMC meeting.
And reality is that the Fed can only assure the credit markets by projecting an image of control. So, despite the severe problems with credit on a global scale, tackling the inflation risk has taken usurped credit risk [6] as the productive course of action.
Still, questions remain about being inflation hawks [7].
And finally, there is a difference between managing risk and managing volatility [8].
Just add water: applying water to a rock and a hard place results in tubular commuting [9] (hat tip to Dave Barry [10]).
URL to article: https://www.millersamuel.com/jawboning-the-inflation-rock-and-a-hard-place/	
[1] Click here for full sized graphic.: http://www.nytimes.com/imagepages/2008/06/21/business/21charts.graphix.ready.html
[2] inflation has now become the key point of credibility: http://www.nytimes.com/2008/06/21/business/21charts.html?_r=1&oref=slogin
[3] A real rock and a hard place: http://www.bloomberg.com/apps/news?pid=20601039&sid=a2EkUQKAElXs&refer=columnist_baum
[4] brief expectatio: http://www.clevelandfed.org/research/data/fedfunds/index.cfm
[5] the Fed is likely to keep rates the same: http://online.wsj.com/article/SB121365941834979141.html?mod=googlenews_wsj
[6] tackling the inflation risk has taken usurped credit risk: http://www.iht.com/articles/2008/06/22/business/econ23.php
[7] questions remain about being inflation hawks: http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2008/06/21/my_dissent_on_the_risk_of_inflation/
[8] there is a difference between managing risk and managing volatility: http://www.nytimes.com/2008/06/22/business/22view.html?em&ex=1214280000&en=608547533b95e427&ei=5087%0A
[9] tubular commuting: http://www.dailycamera.com/news/2008/jun/06/tubing-work/
[10] Dave Barry: http://blogs.herald.com/dave_barrys_blog/2008/06/completely-insa.html