Posted on 03/25/2009 11:48:44 AM PDT by TenthAmendmentChampion
Inflation fears 'overdone,' with greater risks of disinflation, deflation
WASHINGTON (MarketWatch) -- The Federal Reserve won't retreat from its innovative policy tools until the downturn is over, and fears that they will spark runaway inflation are overdone, Janet Yellen, the president of the San Francisco Fed, said Wednesday.
"I understand these concerns, but I don't believe they warrant a retreat from our current broad approach," Yellen said in a speech to an economist group in New York.
With its benchmark interest rate at zero, the Fed has been purchasing and lending against a wide array of financial products in order to combat frozen financial markets. The central bank's balance sheet has already expanded to $2 trillion.
At its meeting last week, the central bank said it would buy as much as $300 billion in Treasury securities.
Yellen said that the wisdom of the Fed's approach is now the subject of "considerable debate."
(Excerpt) Read more at marketwatch.com ...
reminds me of people who slap their small kids for crying....
.. yep, that’ll help
keep beating the dead horse until it gets up and walks!
Is she Gellin’ ?
Let that sink in for a minute....
And the downturn won't be over until those who were laid off are rehired and that's not on the horizon. Nah we don't have to worry about too much money in this country causing inflation when we send most of the money to other countries in free trade deals. China has to worry more about inflation than we do.
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