Your Lying Wallet

From the Federal Reserve's statement on Wednesday, when it cut interest rates yet again:

Although readings on core inflation have improved somewhat, energy and other commodity prices have increased, and some indicators of inflation expectations have risen in recent months. The Committee expects inflation to moderate in coming quarters, reflecting a projected leveling-out of energy and other commodity prices and an easing of pressures on resource utilization.

Keeping in mind that individuals and businesses use these forecasts for planning purposes, let's revisit the Fed's previous predictions about inflation:

• March 18, 2008: "The Committee expects inflation to moderate in coming quarters, reflecting a projected leveling-out of energy and other commodity prices and an easing of pressures on resource utilization."
  
  
• January 30, 2008: "The Committee expects inflation to moderate in coming quarters"...
  
  
• January 22, 2008: "The Committee expects inflation to moderate in coming quarters"...
  
  
• December 11, 2007: "Readings on core inflation have improved modestly this year"...
  
  
• October 31, 2007: "Readings on core inflation have improved modestly this year"...
  
  
• September 18, 2007: "Readings on core inflation have improved modestly this year"...
  
  
• August 7, 2007: "Readings on core inflation have improved modestly in recent months."
  
  
• June 28, 2007: "Readings on core inflation have improved modestly in recent months."
  
  
• May 9, 2007: "Inflation pressures seem likely to moderate over time"...
  
  
• March 21, 2007: "Inflation pressures seem likely to moderate over time"...
  
  
• January 31, 2007: "Readings on core inflation have improved modestly in recent months, and inflation pressures seem likely to moderate over time."
  
  
• December 12, 2006: "Inflation pressures seem likely to moderate over time, reflecting reduced impetus from energy prices, contained inflation expectations, and the cumulative effects of monetary policy actions and other factors restraining aggregate demand."

And excerpts from some of Bernanke's past speeches and testimony:

• 7/19/06: "FOMC participants project that the growth in economic activity should moderate to a pace close to that of the growth of potential both this year and next. Should that moderation occur as anticipated, it should help to limit inflation pressures over time...the economy should continue to expand at a solid and sustainable pace and core inflation should decline from its recent level over the medium term...our baseline forecast is for moderating inflation."
  
  
• 11/28/06: "Core inflation is expected to slow gradually from its recent level"...
  
  
• 3/28/07: "Core inflation, which is a better measure of the underlying inflation trend than overall inflation, seems likely to moderate gradually over time."
  
  
• 7/18/07: "With long-term inflation expectations contained, futures prices suggesting that investors expect energy and other commodity prices to flatten out, and pressures in both labor and product markets likely to ease modestly, core inflation should edge a bit lower, on net, over the remainder of this year and next year."

Polls show that inflation worries Americans more than jobs, the stock market, or declining house prices. This Fed has proven itself either willfully deceptive about inflation, or incapable of forecasting it. And some want to give even more authority to this bunch? The only thing the Fed needs more of is congressional oversight.