The Fed is unhappy with the inflation rate. And guess what? They’re blaming you.
“Although inflation expectations seem much better anchored today than they were a few decades ago, they appear to remain imperfectly anchored,” Ben Bernanke glurbled yesterday in a speech before the National Bureau of Economic Research. “Undoubtedly, the state of inflation expectations greatly influences actual inflation and thus the central bank’s ability to achieve price stability.”
Let’s unpack that a little: “Inflation today isn’t as bad the ’70s, but it’s not perfect, either. Today, public fear of rising prices is causing inflation of the money supply. That makes it harder for me and my friends to control prices and the economy.”
We’ve already seen record-high fuel and food prices this year. But why should that bother anyone? For now, Bernanke and company are sticking to the “close your eyes and picture lower inflation” technique.
“Although inflation expectations seem much better anchored today than they were a few decades ago, they appear to remain imperfectly anchored,” Ben Bernanke glurbled yesterday in a speech before the National Bureau of Economic Research. “Undoubtedly, the state of inflation expectations greatly influences actual inflation and thus the central bank’s ability to achieve price stability.”
Let’s unpack that a little: “Inflation today isn’t as bad the ’70s, but it’s not perfect, either. Today, public fear of rising prices is causing inflation of the money supply. That makes it harder for me and my friends to control prices and the economy.”
We’ve already seen record-high fuel and food prices this year. But why should that bother anyone? For now, Bernanke and company are sticking to the “close your eyes and picture lower inflation” technique.
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