Salient to Investors:
Paul Volcker said:
- The Fed will fall short by being asked to meet price stability and full employment – a mandate both operationally confusing and ultimately illusory.
- Asking too much is accommodating misguided fiscal policies, dealing with structural imbalances, to square continuously the hypothetical circles of stability, growth and full employment – efforts that cause the Fed to lose sight of its basic responsibility for price stability and a stable currency.
- Credibility must not be frittered away by yielding to the notion that a little inflation right now is a good thing to release animal spirits and pep up investment.
- Inflation cannot be manipulated to reach economic objectives, and when fairly and deliberately started is hard to control and reverse.
Read the full article at http://www.bloomberg.com/news/2013-05-29/volcker-cautions-federal-reserve-may-fall-short-.html
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