Well folks, the tough talk phase at the FED didn't last long. Much as we suspected, FEAR at the FED has TRUMPED the longing for the anti-inflation Crusader macho. The holy crusade against inflation has gone right back where it belongs, into the trash bin.
Illusion can persist in the realms of politics and foreign policy because there is no HARD ACCOUNTING. The sustenance of illusion-based "policies" in the monetary realm is far more difficult, for the MARKETS VOTE, AND THEY VOTE EVERY DAY. Unlike regular "elections," when the markets vote THE EARTH TREMBLES. When the markets speak loud enough, the HOBGOBLINS OF FEAR rise swiftly to the surface, driving all before them.
We wonder whether central bankers will ever learn. All their delaying, pussyfooting around, and skin-deep bravado accomplish is to DELAY THE INEVITABLE at SERIOUS COST TO THE ECONOMIC WELL-BEING OF SOCIETY.
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