NEVER TRUST A FED MAN OVER 30:

If Inflation Falls in the Forest…: If we listened to the media, no one would have heard the biggest price decline in 56 years. (Noel Sheppard, Dec. 21, 2005, Free Market Project)

Ever since Hurricane Katrina made landfall in late August sending oil prices to $70 per barrel and gasoline above $3 a gallon, the media have been in a panic over a return of ’70s-style inflation. Such concerns reached a fevered-pitch in October when a gauge of consumer prices rose by the largest amount in 25 years. Yet, when the Labor Department released numbers last week showing that inflation had declined by the greatest percentage in 56 years, rather than using this data to ease the public’s concerns about rising prices, the press either downplayed the report or totally ignored it. [...]

America has been in a disinflationary cycle since the early ’80s, with a few very short-lived spurts of above-trend price rises since. Yet, the thought of a return to ’70s-style stagflation strikes fear into all who lived through it. As a result, the press have a solemn responsibility to report these figures to the public in as impartial and factual a manner as possible…or is that asking too much?

Which is why the Fed Chairman should be someone who was no more than a minor in the 70s.

Posted by Orrin Judd at December 21, 2005 6:55 PM