Morning Must-Read: Alan S. Blinder: Behind the Fed’s Dovish Turn on Rates

Alan Blinder: Behind the Fed’s Dovish Turn on Rates: “The battle at the Federal Open Market Committee…

…is now on. Score the previous meeting in late July for the inflation hawks, but last week’s meeting went for the doves…. The committee’s hawks would like the phrase ‘significant underutilization of labor’ removed from the statement…. They want the FOMC to stop declaring that interest rates will remain at their current superlow levels ‘for a considerable time’…. The hawks want the Fed to stop saying that it expects to keep interest rates low ‘for some time’…. Plosser dissented again… this time Fisher joined him…. Yet another indicator of rampant disagreement appeared…. Opinions on where the [Federal Funeds] rate should be… for the end of 2016 [range] from 0.25-0.50% to 4%. This is a remarkable degree of disagreement…