For immediate release
The Federal Open Market Committee decided today to raise its target for the federal funds rate by 25 basis points to 4-1/4 percent.
Despite elevated energy prices and hurricane-related disruptions, the expansion in economic activity appears solid. Core inflation has stayed relatively low in recent months and longer-term inflation expectations remain contained. Nevertheless, possible increases in resource utilization as well as elevated energy prices have the potential to add to inflation pressures.
The Committee judges that some further measured policy firming is likely to be needed to keep the risks to the attainment of both sustainable economic growth and price stability roughly in balance. In any event, the Committee will respond to changes in economic prospects as needed to foster these objectives.
Voting for the FOMC monetary policy action were: Alan Greenspan, Chairman; Timothy F. Geithner, Vice Chairman; Susan S. Bies; Roger W. Ferguson, Jr.; Richard W. Fisher; Donald L. Kohn; Michael H. Moskow; Mark W. Olson; Anthony M. Santomero; and Gary H. Stern.
In a related action, the Board of Governors unanimously approved a 25-basis point increase in the discount rate to 5-1/4 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco.
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...Did you catch the part about possible increases in resource utilization? In plain English, that is the unemployment rate. In other words, if the unemployment rate continues to fall, that could put pressure on employers to raise wages due to scarcity of labor and thus add to the inflation rate. In lordandmasterspeak, what might be good for you and your family individually might not be good for the homeland or our new global village as a whole - and you are defined as a 'resource'.
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Senate rejects extension of Patriot Act. We need our Washington rulers to stop their partisan bickering and to get moving on the threats to our nation. That said, I was glad to see this. There are some important issues here that merit much more discussion. On the one hand, it is our government's duty to protect its citizens, but on the other hand, we are a free people with Constitutional rights, and little by little those rights are being taken away by those who are charged with protecting us. Our government needs freedom to move against terrorists and anyone who would threaten our nation, but at the same time, we need to preserve the freedom of our citizens. That is a tough one, and I'm not sure that the folks we have in Washington from either party have what it takes to get it right. We need to pray for wisdom for our leaders, and pray the Lord's continued mercy on our nation. The biggest thing that worries me about my perception of this issue is that I'm coming down on the same side as the ACLU (Anti-Christian Lobbying Union according to some homegamers) on this one - doesn't happen often.
..."Those that would give up essential liberties in pursuit of a little temporary security deserve neither liberty nor security," said Sen. John Sununu, R-NH, recalling that quote was originally made by Benjamin Franklin during the days of our nation's formation.
...Term limits might well be constructive in helping our elected public servants get it right on the tough issues. There is an old saying that the first and most important job for any politician is staying in office. Their motivation to stay in once they are in accounts for a lot of the catering to special interest groups and lack of fiscal discipline. Nobody wants to make the tough choices to put our nation back on track. Perhaps if the pols knew that they were going to be there for one term and one term only no matter what they did, they might be more willing to work out tough issues for the collective good. Our nation was never intended to have a ruling class, and that's what those senators with 30 years tenure have become in this nation.
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...And then we have the secret eavesdropping programs since 2001. This news was bad timing for our President, as it likely contributed to the blocking of the Patriot Act extension. Once again, powers granted are not easily taken away. There is another old saying that when you give a politician a hammer, everything looks like a nail to him or her.
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...What about our borders? Doesn't it seem silly to go through all the security checks at airports nowadays, and then realize that literally thousands of people every day cross our borders with Mexico illegally? And speaking of silliness, I wonder who thought up that catch and release program along the border. At least that program, now that it has come out into public view, is going away. Check out Colorado Congressman Tom Tancredo's website for a lot more on the border issue. Mr. Tancredo seems to be leading the fight to protect our borders.
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WTO Talks? We see all the coverage of demonstrations, but have you seen any real coverage about what the issues are, and why there are so many demonstrators and why they are so well organized? They are portrayed as anti-globalization forces. I'd rather see some coverage about the substantive issues on the table and why some folks are so violently opposed, rather than just sensational coverage of the street protests. What are the issues? The linked article mentions two specific issues of concern to the U.S.: we are concerned about textile imports to our country, and we have offered to stop government subsidies for exported farm products by 2010, and to reduce by 60% the government's support for our farmers over the next five years.
...Once again, as with most issues these days, it sounds like it depends on whether you are putting or taking. Our masters see the big picture apparently, although sometimes it seems what is good for the global village and multinational corporations is sometimes not so good for the U.S. working person. I know lots of folks in my part of the country who once upon a time had good jobs, with benefits and retirements, but have seen those go away. Who's right? That's beyond me. But it does speak to the intent of this blog - living free. If folks could get themselves out of debt and develop an independent stream of income on their own, maybe we wouldn't feel so helpless against these bigger than life issues, and maybe we'd have more dignity as an individual rather than as a 'resource', just another cog in a big machine.
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