The Fed's history has been that they solve one problem but create another,
More Quotes from Anthony Crescenzi:
The PPI just feeds the deflation talk that's run rampant in the past month or so, ... It's upsetting for someone who believes deflation is on the way. Even though there are qualifiers for the April data, that headline is dramatic enough to convince them.Anthony Crescenzi
Expectations are one of the biggest parts of the inflation process,
Anthony Crescenzi
In an environment where there is a lot of uncertainty, the short end will get the benefit. The bond is catching up to the strength on the short end.
Anthony Crescenzi
When businesses begin to believe that others are raising prices, they raise prices, too, ... That will have to be arrested by the Fed, and the only way to do it is sooner rather than later.
Anthony Crescenzi
The Fed will probably cut the both the Fed-Funds rate and the discount rate by 25 basis points tomorrow, to 5.25 percent and 4.75 percent, respectively.
Anthony Crescenzi
This time, they want to keep rates low to fight deflation -- a demon that may have vanished already. They might be successful again, but something else might build up, some other unintended consequence, including some inflation.
Anthony Crescenzi
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