Weak dollar may force Fed into tighter policy

[UpInArms]

http://www.gulfnews.com/business/Banking_and_Finance/10043212.html

Santa Cruz, California: Depreciation in the US currency could increase the need for tighter Federal Reserve monetary policy, San Francisco Federal Reserve President Janet Yellen said on Saturday.

The Fed is watching the US dollar's depreciation for its possible impact in raising import prices as well as boosting export demand, Yellen said in answer to a question after a speech at the University of California Santa Cruz on "Monetary Policy in a Global Environment."

Globalised economy

Yellen said an increasingly globalised economy did not damage the Fed's ability to attain its inflation objectives.

Yellen's speech did not directly address the current United States econ-omic or monetary policy outlook but had touched many aspects of relevance to the topic.

Financial markets lean toward a 17th consecutive quarter-point interest rate hike by the FOMC at its June 28-29 meeting, which would take the benchmark federal funds rate to 5.25 per cent from a low of 1.0 per cent.

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[dysfunctional press]

1. more sleepless nights ahead for those with variable-rate...

and interest-only loans.

it feels good to have it 90% paid off. the light at the end of the tunnel is getting brighter.

[teryang]

2. The gold price indicates the Fed has no credibility

Credibility remains key to the Federal Reserve's effectiveness, she said, adding the Fed has established "a strong and credible record" as an inflation fighter.

[UpInArms]

3. CNBC report seen denting Bernanke's credibility

http://news.yahoo.com/s/nm/20060502/bs_nm/economy_bernanke_dc_2

it appears that the Fed and the Fed Chairman definitely have "credibility" problems.

These slimy hacks have really blown it all.

First with BCCI, then Meanspin and now this joker.

[Truthy Nessy]

4. Diversify, buy gold and euros and rubles

Sorry guys and girls. the american dollar is going down like a plane crash. Russia will be selling its oil and gases starting July 1st , 2006 in rubles. Iran selling its oil in Euros. It's the end of the Petrodollar US era. China can call in its billions of US bonds or dump its reserves in US dollars. Other nations are doing it already.

This is not a good time for the American dollar. Stock up on food and water. Sell your homes and rent or go back to live with mom and dad. The housing bubble is bursting. There is a very good possibility that the great depression of the 30s will be a cakewalk compared to what is to come.

Blame Bush and his neocons.