Fed talking tough on the threat of inflationI made my prediction here.
By MARTIN CRUTSINGER, AP Economics Writer
1 HOUR AGO
WASHINGTON - Federal Reserve Chairman Ben Bernanke and his colleagues are updating Teddy Roosevelt's admonition to speak softly and carry a big stick. The Fed policymakers are starting to raise their voices while brandishing the stick even though they don't appear ready to use it.
When the Fed concludes a two-day meeting on Wednesday, it is widely expected that the central bank will express more concerns about inflation and in that way signal that rate increases could be on the way.
However, at the same time, private economists are widely in agreement that the Fed will not actually start raising interest rates, given how weak the economy is at the moment.
"The Fed is caught between a rock and a hard place," said Sung Won Sohn, an economics professor at California State University. "The economy seems to be slipping into a recession at the same time that inflation is getting worse."
Wednesday, June 25, 2008
Step 1 Talk about raising Interest Rates
Posted by whit at 6/25/2008 07:16:00 AM