Why should the Fed prop up the dollar? In real earnings, we aren’t hurt. Yet. This increase is here to stay. Commodity inflation is never polite. In due course and with the overdue advent of better fuel consumption for US autos, it’ll stabilize.
PS we need the inflation. We need to keep people greedy for stuff. Modern manufacturing will have no problem keeping up. That’s the Fed’s gambit and they are wise. Volcker policies would not help today. We need to outrun it.
Yeah - manufacturing everywhere except the US where we have let nearly every major industry go overseas (or south of the border). It isn't just our stupid-low interest rates causing a plunge in the value of the US $, it is our lack of manufacturing. We import so much... folks just thought we were importing a lot 20 years ago.
Anyone remember FORMER Wal-Mart slogan under Sam Walton? We buy American, so you can".
Now, their unspoken slogan is - we buy as much from China as we can, so you can get cheap stuff... even if you are pissing your job and standard of living away... Oh - and have you applied for our Wal-Mart Credit Card? Pay 24% interest for your Chinese junk...