If firms need pricing power, they should be clamoring for the highest possible rates of inflation. Firms don't have pricing power, but they can still make money, and a lot of it.

They are a bit more sanguine about inflation than the market has been, and they've been trying to tell people that. It doesn't mean they have their head stuck in the sand. With the last sentence of their statement, they leave themselves plenty of flexibility.

It's already been working to dampen demand and cut into purchasing power. The longer it stays here, the longer that impact will last.

You have to look at these numbers over a few months. Coming in, we had several months of very substantial gains. The basic picture is that business spending is bottoming and showing some signs of improvement, but it's not really robust.

You have to look at these numbers over a few months. Coming in, we had several months of very substantial gains, ... The basic picture is that business spending is bottoming and showing some signs of improvement, but it's not really robust.

We've been waiting for something like this for a long time. But we need to resist the temptation to put too much weight on any one month's report -- probably the best thing to do is to average out the past few months; that gives a clearer picture.