June 2, 2005
FIGHTING IMAGINARY MONSTERS...AND WINNING!:
Striking out inflation (Larry Kudlow, June 1, 2005, Townhall)
Dick Fisher is the spanking new president of the Federal Reserve Bank of Dallas and a voting member of the Fed’s open market committee policy arm. A terribly bright guy, he is somebody who reads the research memos and looks at the data. He may be a Democrat -- he served as deputy trade representative in the Clinton administration -- but he’s my kind of Democrat. In short, he’s a pro-market, pro-business free-trader who doesn’t think profit is a dirty word.So when Fisher told CNBC that “We’re clearly in the eighth inning of a tightening cycle,” he wasn’t just tossing any old baseball analogy at the economy. He was saying he believes Fed monetary policy has done a good job at containing core inflation. [...]
To be sure, Fisher is hardly speaking from left field. The indicators soundly back him up.
The oil-price shock has not spilled over into non-oil or non-energy price increases. The core consumer spending deflator (excluding food and oil) -- Alan Greenspan’s favorite price measure -- has been steady at only 1.6 percent growth over the past eight months.
What’s more, sensitive commodity and market-price indicators that tend to lead inflation have turned down with a vengeance. This includes gold, raw materials, and Treasury-bond rates. Meanwhile, the difference between long- and short-term interest rates, known as the slope of the Treasury yield curve, has narrowed substantially, though it still remains positive and normal. These are all signs that inflation is contained and well within the Fed’s target range.
Similarly, The Wife hung garlic around the house and it has kept us absolutely free of vampires. Posted by Orrin Judd at June 2, 2005 11:34 AM
any tips for dealing with hippies ? they like garlic...i was thinking a "Help Wanted" sign might work pretty good.
Posted by: cjm at June 2, 2005 12:41 PMCJM - great South Park episode where Cartman is a hippy hunter. At the end Cartman uses a huge drill to make his way through a hippy concert crowd, dismembering many hippies in the process.
Posted by: AWW at June 2, 2005 1:05 PMaww: that was what prompted my hippie question :) that was a great episode. some of the rhetoric (from the episode) sounds awfully close to what our "guests" have been spouting.
Posted by: cjm at June 2, 2005 3:53 PMIt's when you fight imaginary monsters, and lose, or hang up garlic, and are still plagued with vampires, that you need to start worrying.
raoul: who you calling don quiote ? :)
Posted by: cjm at June 2, 2005 6:01 PM