Richmond Fed's Lacker: Monetary Policy Has Done What It Can
Richmond Fed President Jeffrey Lacker has switched back to diesel from unleaded, apparently.
In a recent interview with Market News International, Lacker refused to say whether QE 3 was a hot topic of conversation at the FOMC's last meeting but did note in typical cryptic Fedhead fashion that the new "forward guidance" could have been something of a compromise between the easy money whores and the hawks. "[To some extent this is the first step one would take if one were going to take a step," he said. Right.
Lacker warned that the Fed is courting increased inflation with its extraordinarily stimulative monetary policies.
And he expressed strong opposition to proposals that the Fed deliberately allow inflation to run well above its implicit 1.7% to 2.0% target for a time in an effort to spur economic growth.
Lacker, who will be an FOMC voter next year, declined to say whether or to what extent the FOMC discussed QE3 last Tuesday.
Lacker said he has become less optimistic about the economic outlook than he was a few months ago, but said he does not see the United States heading back into recession and suggested the inflation risks are to the upside, not the downside.
When they asked him how he feels about this whole extended period/2013 nonsense, he replied in old school Lacker fashion "it doesn’t strike me that more monetary stimulus is what this economy needs." Be still my cold black Fedbashing heart.
"I didn’t think it was warranted," he said. "For me, I think monetary policy has done what it can."
Could it be? Is Lacker fluffing himself for a bad ass 2012 voting year? Has he broken the grip of the unicorn piss his coffee has been dosed with for the last year or two?
We can only hope.