The Fed knows darn well that higher oil prices increase the risks of a recession more than it does triggering massive inflation. If the price of oil suddenly crashed and consumer spending were to get better than the Fed might want to go to 4.25 percent but I think 4 percent is the magic number.
More Quotes from David Kelly:
One thing that's clear is that the Fed is determined to still seem balanced. The minutes will reflect a little more inflation concern and a little more concern about the economy but no deviation from the measured pace.David Kelly
There's clearly a lack of interest in investing while the economy works through these Katrina issues, ... We need to get a clearer sense of when gasoline prices are going to come back to normal. When I talk to retail investors, a lot are frozen by the level of uncertainty those issues create.
David Kelly
We hope a review of these cases will jog the memory of the people.
David Kelly
Productivity can act as a natural thermostat for inflation and prevent it from becoming dangerously high or low.
David Kelly
No, all I can say is that it was the Number 10 press office.
David Kelly
A lot of American businesses are still fighting the last recession as opposed to gearing up for the next expansion. That process could take a few months, so we could still see some ugly numbers from the labor market for another month or two.
David Kelly
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