The Fed: "between a rock and a hard place"

Higher inflation makes Fed’s job a lot tougher

Excerpt:

With the economy slowing and the housing market stuck in reverse, Wednesday’s surprise pop in the government's monthly inflation data was not good news for the Federal Reserve.

The problem: Central bankers now find themselves between a rock and a hard place in trying to meet their dual goal of setting interest rates low enough to get the economy moving again while keeping rates high enough to keep prices in check.

The Fed can’t do both. But given the ongoing turmoil in the capital markets — and the risk of a credit crunch that could do even more damage to the fragile economy — Fed watchers say inflation-fighting is taking a back seat.

Comment: Add this: The need to avoid Stagflation

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Funny thing at work today:

The three rules of public speaking: know your audience, your your limitations, and keep it simple.

I was in a meeting today that was over Net-Meeting. I was in a conference room with the presenter and a guy from finance. The presentation was via PowerPoint and had over 30 slides. Midway through the meeting, my eyes were growing dim but I fought to stay awake. The finance guy to my left dozed off completely. At one time he had his head on the conference table. The humor of this kept me alert.