‘This Inflation Speed-Up Must Be Taken Seriously’

Source: Larry Kudlow

U.S. economist John Lipsky, who is the first deputy managing director of the IMF, is giving a speech today before the Council on Foreign Relations in New York that warns of the spread of global inflation.
Lipsky says, “This inflation speed-up must be taken seriously, as it creates potentially significant challenges to economic stability that could undermine prospects for restoring the combination of solid growth and low inflation that prevailed earlier in this decade.” He goes on to say, “To put the issue starkly, inflation concerns have resurfaced after years of quiescence.”
Lipsky, a former Wall Street economist and periodic Republican advisor, fingers the commodity boom as the main inflation culprit. I have written that since last autumn, I have become worried about inflation for the first time in ten years. The CPI has increased by 4 percent over the past five months. And I will finger the run on the dollar as the chief inflation culprit.
Along with the Fed’s excessive interest rate cutting, the emergence of the U.S. peso is the biggest driver of rising commodities and inflation.

Before people all gang up and start bashing me for using something Larry Kudlow says.... the only thing I found to be in agreement is the headline that the inflation speed up must be taken seriously. The current fed stance and strategy is confusing at best. The expect inflation to come down over time though most of their measures have not been anti-inflationary. With each passing day, inflation problem seems to be growing and getting worse. Spill from high energy and food prices should definitely to be expected at sometime unless efforts are made to contain inflation. Wages are under tremendous pressure at the same time and investments not yielding adequately to cover inflation (be it CD yields or other instruments). The only thing the consumer can do as a hedge is buy oil futures or commodities. King dollar... what king dollar are you talking about Mr. Kudlow... what we need is less of the TV and energy savings - may be they can black out a couple of shows for the nations benefit [Jim Cramer, Larry Kudlow and Lou Dobbs] and save energy.