Just when it looked like we were safe from the Fed, inflation is taking off around the world. The European Central Bank and the Bank of England both pushed interest rates up another 25 points Thursday, reports the Associated Press. And the central bank in Australia raised that country's equivalent of the prime earlier this week.

"The decision reflects upside risks to price stability over the medium term," said ECB President Jean-Claude Trichet. And there's no secret about what's causing that upside risk: It's the price of oil, which has stayed at historic highs over the last few years.

And we got the bad news about the US on Wednesday. Retail spending was down and inflation was up, reported the New York Times. As the paper points out, the big question is how the Fed will keep the economy humming along without being too lax and letting the inflation genie out of the bottle. The economists are saying, "On the one hand … but on the other …" which means there's no clear answer on making both those things happen.

My hunch would be they'll tap the brakes again next week with another quarter point jump. They've had a thing about inflation so long, it's hard to see them easing up now. If we still had Greenspan, it would be a certainty but we still haven't seen enough of Bernanke's form to be absolutely sure.