Just as I and all others with any economic sense at all said:
Federal Reserve Bank of Philadelphia President Charles Plosser said prices may rise 2.5 percent in 2011, a rate well above central bankers’ preferred range, and cautioned against complacency on inflation.
“The economy may be at greater risk of inflation than the conventional wisdom indicates,” Plosser said in a speech yesterday in New York. “While inflation expectations appear to remain anchored, we should not become sanguine about our credibility. It can be easily lost.”
The bank president’s inflation forecast for 2011 exceeds central bank officials’ long-run preferred range of 1.7 percent to 2 percent, and contrasts with the concerns of some officials and economists that the economic slump may provoke a broad decline in prices.
It’ll be higher than that – you can’t print trillions of dollars without a massive devaluation of the currency already held, and that means inflation. I converted my investments yesterday just in line with this. Have you?
UPDATE: And the dollar drops like a rock.
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