FOMC Minutes Show Fed Concerned Over Economic Growth

The FOMC minutes from the last meeting just came out, and paint a picture of a Fed that is finally concerned with the growth prospects of the economy, even though all the Fed-heads ever talk about in their speeches is inflation.

Here are the highlights:

• Fed raises core inflation forecast to 2.0%-2.2% from 1.7%-1.9%
• Fed says decisive rate cut seen as 'reducing economic worries'
• Fed raises total inflation forecast to 2.1%-2.4% vs 1.8%-2.1%
• Fed Minutes says 50-basis-point rate cut not seen contributing to inflation pressures given weakness
• Fed raises '08 jobless rate forecast to 5.2%-5.3% vs 4.8%-4.9%
• Fed judged inflation data "disappointing," expects core inflation to "moderate" over next 2 years
• Fed sees slower US economic growth, rising price pressure in '08
• Fed cuts 2008 GDP growth forecast to 1.3%-2.0% from 1.8%-2.5%
• Fed says chance of steeper home price drop, cutting wealth and credit access, a 'significant risk'
• Fed says some worried Jan 22 cut would be seen as mkt-driven
• Fed says it lowered U.S. economic growth forecast due to housing contraction, tighter credit
• Most Fed officials saw risks to growth as weighted to downside, jobless rate risk tilted to upside

Aside from this, I suggested this morning that the early strength in the financials might be a good 'tell'. So far, that is exactly the case. The markets bottomed early, and have since reversed all of their losses and are mounting a nice rally.

Let's see if this can hold into the close--