Is the Fed Thinking About Inflation or the USD?
John Crudele’s theory is that Bernanke is focused on the strength of the USD and using inflation as cover to take rate cuts off the table. Until Americans go on vacation they are typically unaware of shifts in currency strengths. It would take dramatic decline in the strength of the USD for most Americans to pay attention – a situation Bernanke wants to avoid. Like a man falling out of a high-rise window and giving a status update at every floor, it’s “so far, so good”:
Despite too many problems to go over again here, investors are having their annual summer romance with stocks and the Dow Jones industrials could easily hit the 15,000-level by September.
But inflation is a funny thing. Like the ugly baby, you can deny its existence even as it is goo-gooing you in the face. But eventually the truth will come out.
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Posted: July 20th, 2007 under Americas, Foreign Exchange, General.
Comments: 2
Comments
Comment from george smith
Time: November 28, 2007, 8:41 am
The ability of the federal reserve to print money without any financial basis is at the core of this problem. Anyone who does not see the wisdom of Ron Paul (2008 Republican candidate for President) and the need for a sound basis of the USD is a fool.
Comment from Matthew “MT4 Forex Trader” Marr
Time: February 19, 2008, 6:15 pm
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