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"We’re not in the business of trying to create inflation," Bernanke says at a Fed...

"We’re not in the business of trying to create inflation," Bernanke says at a Fed conference today, dismissing the idea the Fed may raise inflation too high in order to aid growth. "Our purpose is to provide additional stimulus to help the economy recover" but "our credibility must be maintained... [and] it’s critical for us to maintain inflation at an appropriate level.”
Comments (12)
  • The PolyCapitalist
    , contributor
    Comments (156) | Send Message
     
    It will be interesting to see whether the Fed's credibility will remain strong enough to justify its secrecy:

     

    www.polycapitalist.com...
    6 Nov 2010, 02:35 PM Reply Like
  • tunaman4u2
    , contributor
    Comments (3217) | Send Message
     
    All credibility has been lost, especially after your Op Ed piece. Wealth effect to buy coach bags until every last person has spent their "assets" & theres nothing to inflate.
    6 Nov 2010, 02:37 PM Reply Like
  • Donald Ingram
    , contributor
    Comments (3481) | Send Message
     
    What a load of ........ !

     

    Not inflation? How about hyperinflation?
    "help the economy recover"? The recession ended last Summer didn't it? Doesn't that mean we're recovered? Like beyond recovery?
    Credibility? The only thing credible about the private for profit federal reserve bank is it's belief in profits!
    6 Nov 2010, 02:53 PM Reply Like
  • MarketGuy
    , contributor
    Comments (3983) | Send Message
     
    One big fat steaming pile of Keynesian crap.
    6 Nov 2010, 02:58 PM Reply Like
  • TraderMark
    , contributor
    Comments (2422) | Send Message
     
    "We are in the business of inflating asset prices aka manipulation... but please, do not question our credibility. Thanks for coming."
    6 Nov 2010, 03:05 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3083) | Send Message
     
    The Fed is "creating inflation" in the process to "maintain inflation" to use Bernanke's own words. I almost feel sorry for Geithner at the upcoming G20 meeting, because he will catch the brunt of angst from other nations.

     

    Strictly on a investment basis, I treated the FOMC announcement like an almost black swan event (maybe call it a grey swan, or grey goose) and took a few profits on selling some shares. Despite the optimism of the FOMC, they seem to me to have drank too much of their own Koolaide, so I will be waiting for a (much needed) market correction prior to re-investing.
    6 Nov 2010, 03:14 PM Reply Like
  • Uncle Pie
    , contributor
    Comments (3499) | Send Message
     
    The US dollar has lost 95% of its purchasing power since I was young, eg. in 1964, the last year our coins were made out of real silver. There's no way that "Fed" and "credibility" can appear in the same sentence.
    6 Nov 2010, 03:16 PM Reply Like
  • nobby73
    , contributor
    Comments (1177) | Send Message
     
    The Fed is in the business of preserving the solvency of the large national banks, whatever happens as a consequence of this policy is of minor importance.

     

    The problem is, we know they are targeting higher inflation, but the metric they use seriously underestimates the impact of higher commodity prices or the time lag effect on end prices, and so by the time they get the inflation they are hoping for, there will be a serious problem with input prices. This will squeeze corporate profit margins, but any tightening, or even a talk of tightening, will cause a sharply correct in equities.

     

    There creating one mighty bubble, which is all they know how to do and it will end like all the others....
    6 Nov 2010, 03:18 PM Reply Like
  • enigmaman
    , contributor
    Comments (2686) | Send Message
     
    OK " "our credibility must be maintained" thats a good one, so what does the Feds track record look like, Greenspan and Bernanke both co workers that were complicit in creating some of the most devastating economic times in recent history. During his run as Fed Chair Greenspan flooded the markets with cheap money for to long creating economic bubbles that he later burst by raising rates to much to fast and now claims his policies had nothing to do with any of the problems that resulted.

     

    Now you have Bernanke doing just about the same thing flooding the markets with QE2,. QE1did not work except to add to our burden, now QE2, its like giving a drowning man water to drink, when your drowning the last thing you want is more water.

     

    Then Bernanke has the unmitigated gall to say " it’s critical for us to maintain inflation at an appropriate level.” like he will have the foresight, ability and fortitude to launch a preemptive strike to stop the unacceptable inflation levels from materializing , to do this he has to see what isnt there yet and discern the good inflation from the bad and then know exactly when to reverse course, the problem with this is once inflation takes hold and it is now, there is no way to quantify its severity, depth or velocity until you get the stats that cause concern by then it will be to late.

     

    This is a grand experiment without basis for credible outcome calculation, he has said as much and therefore he has no credibility, he is all in and swinging for the fences though he is not know for his batting prowess
    6 Nov 2010, 04:49 PM Reply Like
  • lower98th
    , contributor
    Comments (1420) | Send Message
     
    Bernanke is the party most responsible for those Americans that will die this winter of malnutrition and cold exposure in their own homes. Quite a legacy.
    6 Nov 2010, 09:31 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3533) | Send Message
     
    " [and] it’s critical for us to maintain inflation at an appropriate level.”

     

    How is maintaining inflation compatible with a strong dollar? As prices ramp, the government will be under (manufactured) pressure to stop the "greedy capitalists" (like farmers) by instituting price controls. Whip Inflation Now. Sure:-(
    6 Nov 2010, 10:43 PM Reply Like
  • cbc
    , contributor
    Comments (411) | Send Message
     
    Agree. But as a greedy capitalist farmer I will be sucking every price hike dry so I can keep up with inflation. It is all I have got to keep me rolling. Blame Bernanke and co not farmers. We are not the problem. I will feed all I can as long as I can make a living. I am a small scale farmer so please do not lump us all together with agro business. Also I go with market guy. "One big fat steaming pile of Keynesian crap."
    7 Nov 2010, 12:15 AM Reply Like
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