We'll see continued downward pressure on unit labor costs in the first quarter. I think it's favorable on the inflation front.
More Quotes from Keith Hembre:
Oil is a double-edged sword. From one aspect, it lifts overall inflation but from the other side of the same coin it places a constraint on growth. So if oil prices remain high, the implications for the Fed get a little dicey,Keith Hembre
The Fed are saying that there is no evidence yet that underlying inflation is moving higher.
Keith Hembre
The historical pattern is for shocks of this nature to initially be absorbed roughly equally between lower savings and lower purchases for other goods and services.
Keith Hembre
Growth should decelerate through the final three quarters of the year and once that happens inflation pressures we've seen will begin to ease. That should lead to a more benign tightening cycle, which won't be threatening to the financial markets,
Keith Hembre
Further moves will be dictated by the tone of the data leading up to the next meetings. This is not to say that the fed funds rate couldn't go to 5 percent but there would need to be more underlying strength in the economy to drive it there.
Keith Hembre
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Other projects later this year, but I think it's going to be a very very busy year this year with Star Wars and the re-release, so I'm sort of running about going backwards and forwards to America, Japan, Mexico. So there will be a lot of things to do.
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Napolean is dead - but Beethoven lives.
Bruno Walter