Bill Cheney Quotations | Page 2

If even 5 to 6 percent GDP growth isn't enough to get any net hiring, then the risks rise that the stimulus from the tax cuts and defense spending could produce a one-time boost that will fizzle out next year.

I'd say there's only a 25 percent chance of a rate hike in June even. Even with another strong jobs report Friday, they'll want to have something that looks more definitely like a trend.

I don't think we can discount the legitimate concern that the Fed has been pumping too much liquidity into the economy. It may be that they have to backpedal furiously as the economy starts to recover. Inflation has been down for so long, it may be hard to imagine it ever getting back up -- but you better believe it still can.

I don't think the Fed is under pressure to raise rates faster than they have been but I think they'd be crazy to think that they should be done tightening.

Granted, it feels bad, but that's mainly because we had it so good. In reality, we still have positive growth, low unemployment (even if it rising), and low inflation. Maybe that's why consumer confidence is holding up.

For now, however, inflation is a problem that we would welcome. Over the short-term, in the absence of any current inflation threats, it makes sense to do whatever we can to get the economy moving again.

The unemployment situation won't truly improve until businesses increase hiring a lot more than they did in February. It takes roughly 150,000 new jobs per month just to keep the unemployment rate steady, as population growth increases the work force.

The headline number is absolutely kind of a shock, I think the bond market is probably overreacting. It's a bounce back from September, but we're still not gaining back all the ground lost in September. The underlying trend is still kind of down.

The Greenspan Fed has inaction down to a fine art. They stood by through much of the late 1990s, allowing a very beneficial reduction in unemployment without suffering any inflationary consequences. When they do have to move, they do so quickly and surgically.

The inflation threat has receded yet again. I can't see the Fed moving now at least until early next year. They have almost no evidence of inflationary pressures and there are hints that the economy finally is slowing.

The economy is neither roaring nor stalling; it's clearly out of the soft patch and moving along at a decent pace, and that's all the Fed needs right now.

All the evidence on consumer confidence would tell us that all spending on big-ticket items is liable to plummet in the next month or two.