I still need to say 8 Hail Marys regarding my erroneous gold call, but in the meantime let's have some fun with today's CNBC article on inflation:

Federal Reserve Chairman Ben Bernanke must find a convincing way to explain why his central bank is in no hurry to raise interest rates even though the economy is stabilizing.

Does that strike anyone else as funny? The "must" in that sentence derives entirely from the the writer's decision to go with the official Fed line, rather than those of some outside analysts. Compare to an analog from foreign policy: "Defense Secretary Donald Rumsfeld must find a convincing way to explain why U.S. forces are in no hurry to leave Iraq, even though the country has no WMDs." Wouldn't that have been a bit creepy, even for our press? Yet when the rules are bent for the Fed, it seems natural.

The Fed thinks that with unemployment at a 26-year peak and idle factory space at its highest on record, there is little near-term risk of prices overheating.

I owe my Hillsdale students a refund. I told them that economists learned there could be idle resources and large price inflation during the 1970s. My mistake.

Dino Kos, managing director at the research firm Portales Partners and a former top Fed official, said as long as the weak economy chills demand for credit, the free-flowing central bank cash poses no inflation threat.

See above. And my father taught me to never do business with a man named Dino.

Economists polled by Reuters see no chance that the Fed will raise its benchmark short-term interest rate from the current level near zero at this week's meeting.

That said, the central bank will probably want to nurture hopes that the end of the recession is nearing.

Isn't this disgusting? Seriously, reread that last sentence. What are we, girlfriends with low self-esteem? Lie to me, Ben! Tell me what I need to hear!

How quickly inflation builds depends on how quickly factories get back to full speed and the job market recovers, as well as whether the Fed can swiftly scale back lending programs and rate cuts.

Oh my gosh. Up till now, the CNBC writer thinks he has been negotiating the disagreement between the inflation hawks and the doves, but at this point in the article he just stated matter-of-factly that stagflation is impossible. Stop talking to Dino!