Posted on 02/25/2011 3:30:19 PM PST by NormsRevenge
NEW YORK (Reuters) – The Federal Reserve would react to higher oil prices only if the increases spilled over into broader areas, officials of the U.S. central bank said on Friday, with one policy maker calling the risks "manageable."
In a similar vein, an official of the European Central Bank said policy makers should be wary of responding too soon to the recent jump in oil prices as it may be fleeting.
Oil prices have risen as political tensions in the Middle East and North Africa have raised fears that the unrest could spread to other major oil-producing countries, stoking fears of even higher fuel prices and inflation risks around the world.
The president of the Richmond Federal Reserve Bank, Jeffrey Lacker, took a calm view of the potential threats to the U.S. economy from the higher oil prices, though he said they could prove nettlesome if they jump much more or create an inflationary psychology.
"I think the oil price rises we've seen so far don't pose a risk to the recovery," he told reporters after a speech on regulation.
"Oil price changes could have the potential, if they were very large, for slowing the recovery, but we have a lot of experience and a lot of data on past instances, and I think it's a manageable risk," he said at a conference organized by the University of Chicago's Booth School of Business.
Janet Yellen, the Fed's vice chair, said U.S. central bank officials would react if inflation expectations or underlying inflation show persistent gains and began to be reflected in other prices.
(Excerpt) Read more at news.yahoo.com ...
They need to stop reacting. They’ve set the middle east ablaze already with their reacting
Didn’t they also “play down” the risks of credit-default swaps and trillions of dollars worth of liar loans?
“calling the risks “manageable.”
This person may be able to pay $5 plus for fuel...
But the rest of us, you make fuel $4, you got the recipe for anarchy , and it will be by both sides of the political spectrum, and they (the feds) damn well know it.
EL
The White House wants $5 gallon gas. They are not going to do anything about this.
Obama and these idiots are all scared to death or they wouldn’t be trying this BS sham.
Well, in 0’s case may be not scared but giddy with anticipation.
Not one single fed official can be trusted about anything. I can’t remember the last time a government spokesman said anything remotely true.
LLS
They ar looking for any excuse to have zero call out his posse, a papercut by a union official on picket would have zero toss the hell and high water card, I believe the armed forces know it, I believe the local police and fema and any quasi govt with emergency powers knows this.
They know, if SHTF by zero, some of them are going to have to defend (note I did not use the A word) against their friends, brothers, neighbors.
I trust zero about as much as I trust the communist party is not seeking to dominate the United States of America.
EL
Yeah, if I were a Pres of a Fed Reserve Bank, I don't think I'd concern myself with $4 or $5 gal either, but some of us make our living with trucks/vans and if anyone suggests that even $4 gal will not hurt our economy, they are clueless, morons or simply engaging in spin.
If doing nothing is reacting then what could be better than a do nothing President doing something that amounts to nothing.
“The Federal Reserve would react to higher oil prices only if the increases spilled over into broader areas, officials of the U.S. central bank said on Friday, with one policy maker calling the risks “manageable.””
And just what do they think they can do? NOTHING!
Short of the ME calming down and stabilizing the ONLY thing that the politicians could do would be to open ANWAR and the Gulf back up to drilling and possibly other places.
The mere speculation of new oil coming online in the future would drop the prices.
It's not just the price at the pump, but everything else that needs gas/oil to make it to market. Just got back from the grocery store and prices are going up. Last week, I could afford roma tomatoes at .82/lb. Today, I refused to pay $2.32/lb. for the same roma tomatoes, nor did I buy any yellow squash at $2.48/lb. I did stock up on an American brand canned veggies that hadn't gone up - yet. From the looks of the shelves, others had the same idea. The cashier asked who all I was feeding and was shocked how long it took to get to $100 (went over that but it took a while). I look at it like this, prices are going up but my income isn't. Throw in the shape of the world and yeah, I'm gettin' while the gettin's good.
Agreed.
OK, I must really be out of touch. When did the Fed start drilling for oil? Or, when will they?
Are they going to replace our money supply with cans of Penzoil?
Most of us analyst types are expecting a very large worldwide war in the period 2012-2017. It will involve nuclear weapons.
Nyquist, Sousken, and many others are in agreement of the war happening, but not the exact timing.
I could see that happening.
In the meantime, local prices in Emmitsburg, Maryland jumped from $3.19 to $3.35 this afternoon.
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