The U.S. Federal Reserve may need to decide on when to tighten monetary policy before the outlook for the global economy clears up later this year, St. Louis Fed President James Bullard said.
Ya think, Jim? Funny thing about those rising short term Treasury yields, they don't leave much wiggle room do they?
“The process of normalizing policy, even once it begins, will still leave unprecedented policy accommodation on the table,” he said according to a statement on remarks he was to deliver at a financial forum in Prague today. “The FOMC may not be willing or able to wait until all global uncertainties are resolved to begin normalizing policy.”
Why not go all the way? Copper around all time highs... Oil beginning to piss off the electorate again... US manufacturing is going well... just do it. Pull it all back and see what happens. QE policy has nothing to do with 'global uncertainties' and everything thing to do with legacy leverage, new leverage and a long standing habit of living for today, on ever increasing debt and a 'screw the future' ethic.
Boston Fed President Eric Rosengren said yesterday that high unemployment and low core inflation mean record monetary support is still necessary. Chicago Fed President Charles Evans said he believes data suggesting a more sustainable recovery won’t prompt an alteration in the bond-purchase program.
Whack-a-Moles everywhere. Very confusing.
Bullard said last week that he wants a review of the bond program, while Charles Plosser of the Philadelphia Fed laid out a strategy to sell holdings in conjunction with raising interest rates.
The effects of the Fed's own inflation have directed them to talk this way.
Noting the improved economic outlook since the plan was implemented, “the natural debate is how and when the exit should begin,” Bullard said. “However, additional uncertainty has clouded this picture.”
He said four areas in particular are raising “macroeconomic uncertainty.” These included turmoil in the Middle East and north Africa, the natural disaster in Japan, “the U.S. fiscal situation and the possibility of a government shutdown,” and Europe’s sovereign debt crisis.
No it hasn't, just do it. Don't make excuses with outside events. Steady as she goes, the economy is improving and inflation is getting out of control... live up to your mandate!
Fed officials have purchased $1.7 trillion of mortgage debt and Treasuries through March 2010 to pull the U.S. out of the recession. The Fed’s second round of purchases has come under fire from Republican leaders in Congress who say it risks inflating asset-price bubbles and stoking inflation.
In other words, exponential moral hazards have been layered upon the previous cycle's moral hazards in the name of saving the economy from a deflationary crash. This has helped us how? Oh yes, by making it worse and pushing it out into the future for a bit. Lovely.
Separately, it's funny how Republicans did not seem to mind so much 'stoking inflation' when the political spectrum was aligned differently. Whack-a-Moles everywhere.
Chairman Ben S. Bernanke has given no indication the central bank will deviate from its plan to buy bonds through June to spur economic growth and reduce 8.9 percent unemployment.
Good cop.
