skip to main |
skip to sidebar
Don't miss out on th Dr. Ben Bernanke has been calling the Inflation being Transitory and medium term.
Despite the Oil @$113 per bbl, at the 1ST Press conference, he appeared calm and confident. And he regarded the OIL prices being " not that High ", but assured that, ' Some Buffer from high gas prices is required. But, this was sort of a Justification of high prices.
Moreover, the transitory inflation is new garden variety of inflation. Why no one is focused on this word ?
Even though, it sounds like a ' temporary ' , in real terms its a phase or period essential for ' Transforming the recessionary economy into normal economy. All though the ebb of normalcy is artificial and concocted through ' extra ordinary monitory conditions for unknown period, i.e. 0 to 0.25% interest rate and Mortgage repurchase program ( QE2 ).
The recent FOMC minutes show that, even though All that QE2 has managed to do was to supporting economy from falling in the dark hole of debt and slow down. But, it failed to support the long term recessionary tendencies prevailing in the system.
In short, FED may find it impossible to get out of easing program, in near future and look out for the more signals from the market and economy to emerge. Till then, wait....have we circled the racession into slowdown ? And till that happens FED is going to piggy back on inflation and more so on Oil.
No comments:
Post a Comment