Echos Dallas Fed President Fisher’s concern about rising expectations following FOMC decision last month to start an asset purchase program.
- Problem facing U.S. economy is too much debt, warns inflation “surprise” would not ease burden.
- Inflation-linked U.S. bonds suggest investors “do not completely trust Fed” to deliver its 2% inflation target.
- Inflation can been seen as a “partial default” on U.S. debt, says would be paid for via higher interest rates in the future.
- Creditors will seek protection from central bank that might surprise them with a burst of inflation.
- Warns there is “no free lunch in economics, inflation would hurt U.S. savers, foreign creditors.-rtrs
- Says there is a “big concern” in markets about what Fed could do next, would like to get back to more rule-based policy.
- Fed has some room to maneuver on inflation, but not as much as when it was facing deflationary threat in 2010.
- Latest ECB bond buying program “poor policy” that politicizes European Central Bank.
Hello, Mr. Draghi did you know your program was poor policy?
