Bernanke's Words

From WSJ:

Federal Reserve Chairman Ben Bernanke on Tuesday put the U.S. dollar squarely on the Fed's radar screen, saying its slide against
other currencies has led to an "unwelcome" rise in U.S. inflation and may be a factor in inflation expectations. Bernanke also suggested that the Fed is unlikely to lower official interest rates further, though his remarks suggested that - barring a further rise in inflation expectations - the Fed probably won't contemplate higher rates until there is more stabilization in home prices.

Any rise in rates in the near term will crush marginal banks.

It is good to see that inflation is finally getting officially recognized. It cost me $200 to bring my family to the zoo the other day. That's ridiculous!

Home prices will not stabilize any time soon. If they do, it will be bad for the general public. Prices are still much to high relative to real incomes and rental yields. It goes to show how the interests of the Wall Street and instiutions pandering to the Fed are in direct contravention to the interests of Main Street.

Comments

[Alex Wallen...:]

Excellent post, Reggie! Short, to the point, and dead-on!

2008 Jun 05 08:43 AM

[CaptBob:]

I guess if Bernanke continues to say --"NOTHING"--
There will ample repeters to make sure we get the message!!

2008 Jun 05 11:44 AM

[Dave_O:]

Would Paul Volcker allow such unnecessary inflation that we have now, just to keep house prices from falling faster to where they need to be?

2008 Jun 06 04:14 PM