Hooray for the Fed!!!

The Fed yesterday made quite a few announcements.

1. The fed funds rate will not change.
2. The fed funds rate should remain low for the better part of 3 years.
3. Introduced an inflation target of 2%.
4. Forecasts for growth in the economy and in employment.
5. Fed president stated that if unemployment does not improve another round of easing may occur.

In a world where everyone seems to have gone off the deep end its good to see that the central bank of the US is doing its job well.  It would have been nice if the inflation target was a bit higher so that we could blast out of the liquidity trap that we are in, but the transparency the Fed is displaying is very helpful to the economy and shows that there will continue to be extreme accommodation for the foreseeable future.