Fed Watch: QEInfinity Not

The Federal Reserve released the minutes of the June FOMC meeting today, but the contents had little in the way of groundbreaking news.  Most interesting was that Fed officials tired of being pestered about the “October or December” question regarding the end of the QE and decided to more or less commit to the earlier date: Some […]

Yellen vs. Bullard on Wages and Inflation: Who Is Right?

Wage growth is “not a threat to inflation,” Fed Chair Janet Yellen said on June 18.  “[With] our 2 percent inflation objective, we could see wages growing at a more rapid rate” before having to worry. “When unemployment goes into the five range, that is going to below the natural rate,” St. Louis Fed President James Bullard […]

A New Era For Fed Policy… And Inflation?

Inflation is mounting a comeback. Not as an imminent macro threat, at least not yet. But as a topical subject for monetary policy and a relevant factor for looking ahead in economic and investment terms, the subject of inflation will likely resonate on a deeper level going forward. The source of this shift, of course, […]

Fed Watch: Inflation Hysteria

It appears that a case of inflation hysteria is gripping Wall Street. Joe Weisenthal at Business Insidersums up the current state of play: Here’s what’s on Wall Street’s mind right now: Inflation is finally happening, and the Fed will end up being behind the curve. …there were two big moments this week. 1) There was the […]

Fed Watch: Policy-Induced Mediocrity?

Why did the Federal Reserve lean against their optimistic 2014 forecast?  It seems that monetary policy over the past year can be summarized as a missed opportunity to supercharge the recovery, thereby locking the US economy into a suboptimal growth path. Last week’s speech by New York Federal Reserve President William Dudley noted the reasons […]

Fed Watch: Dudley Revisits Exit Strategy

Today New York Federal Reserve President William Dudley gave what was both an interesting and depressing speech.  Interesting in that he provides some new thoughts on the exit strategy. Depressing in that he outlines a case for persistently low interest rates. One wonders why, given such an outlook, the Fed is so firmly focused on the […]

Is the Fed Near Its Target?

The BLS reported on Friday that the U.S. unemployment rate fell all the way to 6.3% in April. That marks significant progress in terms of thebull’s eye of Fed accountability proposed by Federal Reserve Bank of Chicago President Charles Evans which Econbrowser discussed 2 months ago. The unemployment rate has dropped steadily over the last 4 years with no […]