by Tony Sampas
May 8th, 2011
Inflation not a worry for the next couple of years by Marjorie Arons-Barron
The entry below is being cross posted from Marjorie Arons-Barron’s own blog. Check it out.
Dick Syron and John LaWare were affable enough heads of the Boston-based regional operation of the Federal Reserve System. But, when they were out in the community, they seemed to speak only with other businessmen and in highly selective institutional settings. Cathy Minehan did somewhat better. But the current president of the Federal Reserve Bank of Boston, Eric Rosengren, is a really effective communicator. And he seems to enjoy taking his economic analyses and projections, complete with Power Point, across the local landscape, explaining himself in down-to-earth language we can all understand.
Recently he’s been doing his dog-and-pony show around the region, earlier this week at a meeting of the New England Council. His goal is to answer the question of how monetary policy should be used to respond to dramatic price increases, especially when, as recently, food and fuel costs seem to be heading off the charts.(I got a bag of red grapes home from the store to discover it cost $9. But food costs are a relatively small part of American economy. Imagine living in India or China, where food costs are so much larger a part of the national economy!)
Rosengren says the Fed shouldn’t do anything at this time. The causes of the spikes are not a function of monetary policy. Middle East instability affects the oil price. Troubles in Japan disrupted the global supply chain. Weather extremes, such as those in Russia and Australia, affected the global harvest. When you take food and energy volatility out of the formula for measuring inflation, the core inflation rate has really been pretty steady at a bit more than one percent. He doesn’t expect to see more than two percent over the next couple of years.
Meanwhile, he said, if the Fed were to raise rates in response to higher food and energy prices, it would put a damper on the economy and unacceptably slow our recovery. And that wouldn’t do anything to solve Middle East instability, weather affects on the harvest, or logistical disruption in Japan. Thursday, almost on cue, commodity prices—notably oil and food– fell, apparently sparked by fears of the over-heating market.An interesting sidebar is a difference of opinion brewing between Congressman Barney Frank, ranking member of the House Financial Services Committee, and Rosengren. Frank has proposed legislation that would bar regional Federal Reserve Bank heads from voting with the Federal Reserve Board on whether or not to move interest rates in one direction or another.
Frank apparently believes that, in general, the regional heads are too close to the local businesses who voted them in and they’re too partisan and parochial. There’s evidence that this is what happens in other parts of the country.
Rosengren says the board is driven by data not politics and that local input is highly desirable. We’ve all benefited from a central bank that is not partisan, he added. This seems true for Rosengren. My question is: how do the other regional heads behave? I certainly want to hear more about this debate.
In the meanwhile, it’s good to have a Fed leader willing to speak to the whole community… and in English.
Please let me know your thoughts in the comments section below.
May 8th, 2011
Founder of “Reason” magazine dies in Lowell
This may sound a bit morbid, but my favorite section of the newspaper is the obituaries. Each story is a history lesson in itself. In a way, the tour I give of the Lowell Cemetery is a series of oral obituaries shared while walking around a beautiful, natural setting.
While scanning through yesterday’s obituary headlines on the New York Times website, I noticed this one: “Lanny Friedlander, 63, of Reason Magazine, Dies.” Throughout my life I would subscribe to magazines the way I might buy a book. For $12.95, I could get a dozen issues of Runners World or Civil War Times or many others. Unless those issues consistently touched me in some way, I rarely renewed the initial subscription. Because I had once sampled Reason at this literary buffet I decided to read this particular death notice.
The opening paragraph described how Friedlander started the magazine in his dorm room in 1968 with nothing more than a typewriter and a stack of paper, how he had dropped out of sight for 40 years, and the he died “on March 19 in Lowell, Mass.”
What was that? He died in Lowell six weeks ago? Why wasn’t I told?
While still in college, Friedlander became afflicted with mental illness and bounced around, enlisting in the Navy for a short time, driving a cab, but always being afflicted by his illness. He was born and raised in Boston. He ended up in Lowell as a resident of a VA operated halfway house. He was buried from Blake Funeral Home in Chelmsford and buried in the National Cemetery in Bourne. Reason magazine has several stories about his passing (here and here).
May 8th, 2011
In the Merrimack Valley: Locavores – Read the Label!
While all politics may be local, produce touted as local may not be. As Sarah Pinneo notes in her Boston Globe article today – “locavore” – one who eats foods grown locally whenever possible – was named word of the year back in 2007. Farmers loved the trend – large supermarkets not so much. So an on-going tug-of-war over what constitutes “local” produce continues. Local farmer Dave Dumaresq – farmer Dave to we locals in Dracut, Tewksbury and Greater Lowell localities, report that the cachet of ”local” has the supermarkets stretching the reality of what’s local even if it really means locally washed! Farmer Dave and other farmers also report having their locally produced blueberries, bell peppers, lettuce and the like – bought-up by the supermarkets only to have the locally-growth produce displayed under the banner “Fresh – Locally Grown Produce” alongside or below produce shipped in from New Jersey and elsewhere.
Dumaresq tells of a similar experience he had with bell peppers. “I used to sell to a chain supermarket which had a big display right inside the door” with a banner that read “Fresh, Locally Grown Produce” and his vegetables on a shelf underneath. “Each store would usually buy one or two boxes of most of the items that I had available that week,” he says. Behind those displays there would be more peppers, a lot of them from farther away, but it wasn’t clear that the banner was referring to only certain produce. “They weren’t exactly lying,” he says. But now, because he doesn’t have to, he doesn’t sell to that chain.
Read the full Boston Globe article here and learn more about the various definitions for “locally grown produce” and about the CSAs – Community Supported Agriculture – programs in your area and how you can support, participate and be a share holder. Also, check out the local Community Teamwork, Inc program – World PEAS Cooperative – New Entry Sustainable Farming Project here. Look for the highly successful CTI Local Farmers’ Market to open in late June 2011.
BTW -
Culture, Education, Greater Lowell, Politics | 
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