Fed’s Bullard Warns Fed Funds Rate Could Go To 5-7%

IN THIS ISSUE:

1. Fed Spokesman Warns Rates Could Go Much Higher

2. Fed’s Bullard Warns Fed Funds Rate Could Go To 5-7%

3. Bullard Is Outspoken, But Does He Have A Point?

4. Can The Fed Pull Off Higher Rates Without A Recession?

5. Another Way To Lower Inflation – Stop Deficit Spending

Overview – Fed Spokesman Warns Rates Could Go Much Higher

A high level Fed official warned last Thursday that the Fed Funds rate might have to go to 5%-7% to get inflation under control. This was a shocker! Markets plunged immediately after he said it. Fortunately, no one else at the Fed seems to agree with him.

While there is widespread agreement that the Fed Funds rate has to go up more to get inflation under control, no one I read thinks the rate will go much above 5%. Today, I’ll talk about what this Fed official said and offer some suggestions why he may have said it.