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Fed officials see high bar for more bond buys

ANNISTON, Alabama (Reuters) – Two top Federal Reserve officials said on Tuesday they expect the central bank's $600 billion bond purchase program to run its full course, while a third said the central bank should seriously consider scaling it back.

All three suggested the Fed would face a high bar to increasing the program as the recovery gathers pace.

Dennis Lockhart, president of the Atlanta Fed, said based on his current forecast for moderate growth, more bond buying would not be needed after June, while Dallas Fed President Richard Fisher said he would likely dissent if further easing were on the table.

The Fed launched the controversial second round of quantitative easing in November to support a fragile economy. At its January meeting, voters on its policy-setting committee unanimously agreed that with unemployment still high, the program was warranted.

Both Fisher and Lockhart said they expect the program to run its full course, while Richmond Federal Reserve Bank President Jeffrey Lacker said the central bank should seriously consider scaling back the program given a stronger recovery.

The central bank has stressed after its two most recent meetings that the recovery is not strong enough to make a significant dent in an unemployment rate that stood at 9 percent in January.

The debate over whether to extend bond buying will likely come front and center as soon as the next meeting of the Fed's policy-setting committee on March 16. The issue should dominate the two subsequent meetings before the program is due to be complete at the end of June.

"Given current economic circumstances and financial conditions, it is hard for me to envision a scenario where I would not use my voting position this year to formally dissent should the Open Market Committee recommend another tranche of monetary accommodation," Fisher, a known inflation hawk, told a business group in Dallas.

Lacker pointed to stronger growth and a brighter jobs picture as a reason the Fed may have to rethink its policy, but added he was not advocating stopping the purchases at this time.

"An array of forward-looking indicators of employment trends point to continued labor market improvement," Lacker, also an inflation hawk, told a business gathering at the University of Delaware.

Lockhart, seen as a centrist, said that it is unlikely that jobs growth will be strong enough in 2011 to generate "quick improvement" in the employment picture.

Lockhart said inflation was still below his comfort level and that while increases in prices of commodities were fueling some "inflation anxiety" among the general public, they did not "signal incipient inflation," he told the Calhoun County, Alabama, Chamber of Commerce.

He said he expects core inflation to rise gradually, to within the Fed's informal 2 percent target range, by 2013. While headline inflation has picked up in the United States, core inflation has held near a five-decade low.

The Fed has come under criticism from some analysts who argue its easy money policy is flooding the global economy with money and helping to drive prices for food and other commodities higher, contributing to instability overseas.

Lockhart and Lacker both called the criticism "unfair".

Regional Fed presidents rotate into voting seats on the Fed's policy-setting committee. Fisher has a vote this year, but Lockhart and Lacker do not.

(Additional reporting by Ann Saphir in Dallas, Texas and Pedro da Costa in Newark, Delaware; Editing by Dan Grebler)

Rumsfeld admits 'possible' Iraq troop mistakes

WASHINGTON (AFP) – Former defense secretary Donald Rumsfeld releases his new memoir Tuesday, as he concedes his Iraq troop decisions may have been wrong while sparing no criticism of former colleagues.

In "Known and Unknown," Rumsfeld defends his handling of the war and recounts his government career serving Republican presidents from Richard Nixon to George W. Bush.

The former defense secretary was reluctant to endorse Bush's assessment that the decision to draw down US troops shortly after the 2003 invasion of Iraq was "the most important failure in the execution of the war."

"I don't have enough confidence to say that that's right. I think that it's possible," Rumsfeld told ABC News anchor Diane Sawyer.

"We had (an) enormous number of troops ready to go in. They had -- we had off-ramps, if they weren't needed.

"It's hard to know. You know, the path you didn't take is always smoother," he added.

The former Pentagon chief's comments came in his first television interview since leaving public life in December 2006 after a long and divisive tenure at the Pentagon.

They largely echoed his memoir, in which he laid blame for much of the failings and heavy bloodshed of the Iraq war on "too many hands on the steering wheel."

Rumsfeld, who served as Bush's defense chief for six years after holding the the same job under president Gerald Ford in the 1970s, acknowledged that "in a war, many things cost lives."

But he had no regrets about his leadership of the wars in Iraq and Afghanistan -- the latter now nearing its 10th anniversary.

He refused to echo the regrets of another domineering defense secretary -- the late Robert McNamara -- who came to describe the Vietnam War as "terribly wrong."

"That's not the case with Iraq," Rumsfeld countered.

"I think the world's a better place with Saddam Hussein gone and with the Taliban gone and the Al-Qaeda out of Afghanistan," he added, insisting the Bush administration's decision to invade Iraq in the wake of the September 11, 2001 attacks on the United States was "incremental," not rushed.

Rumsfeld said it was Paul Wolfowitz, then a deputy secretary of defense and later a major architect of the Iraq war, who raised Iraq at the Camp David presidential retreat shortly after 9/11.

Just as in his book, the former defense chief also ripped into some of George W. Bush's closest advisers, saying Condoleezza Rice lacked experience and Colin Powell showed poor management skills.

Asked whether he admired his ex-boss's father president George H.W. Bush -- under whom he did not serve -- Rumsfeld replied curtly: "No, I was kind of disappointed in him."

Rice, Bush's national security adviser who later became secretary of state, had "never served in a senior administration position," a lack of experience that hampered her ability to organize critical meetings, Rumsfeld said.

He said Powell -- Bush's first top diplomat -- "did not, in my view, do a good job of managing the people under him," calling leaks out of the State Department "unhelpful."

Rumsfeld said Powell, along with other top Bush advisers and officials, truly believed Saddam Hussein had weapons of mass destruction when he made a presentation to the UN Security Council in February 2003 -- and never spoke up during meetings with the president to raise objections about the war.

"There's a lot of stuff (in) the press that says Colin Powell was against it. But I never saw even the slightest hint of that," he said.

On the weapons of mass destruction that never surfaced despite being cited by the Bush administration as the primary justification for the war, Rumsfeld acknowledged: "My goodness, the intelligence was certainly wrong."

But he categorically refused to to say whether he would have acted differently had he known then what he knows now about Saddam's alleged weapons.

"I have no idea. I have no idea," he said. "What you know today can help you on things you're thinking about tomorrow. It can't help you with things you were thinking about back then. Back then, there was reasonable confidence that he had these weapons."

In conjunction with bookstores selling his memoir this week, Rumsfeld is also releasing online a wide range of nearly 2,000 documents from his tenure in public service, dating back to his years as a congressman in the 1960s. They will be available on www.rumsfeld.com.

Umberger, Huselius lead Jackets 4-3

COLUMBUS, Ohio – R.J. Umberger scored twice and assisted on both of Kristian Huselius' goals, including the game-winning tally with 4 minutes left, to lead the Columbus Blue Jackets past the Edmonton Oilers 4-3 on Saturday night.

With the Blue Jackets trailing 3-2 and 6:16 left, Umberger tied it with a nifty move and a snap shot. He then fed Huselius on a 2-on-1 break, with Huselius tucking a wrist shot inside the near post and past goalie Nikolai Khabibulin.

Magnus Paajarvi had a career-best two goals for the Oilers, who lost their fourth in a row — both goals coming on almost identical plays off assists from fellow rookie Linus Omark. Dustin Penner also scored.

Steve Mason was solid in goal for Columbus, allowing the Blue Jackets to come back from an early 2-0 deficit. He finished with 23 saves.

Huselius also assisted on one of Umberger's goals. Kris Russell also had two assists.

The win was critical for the Blue Jackets, who have little margin for error as they try to stay in the chase for a playoff spot in the Western Conference. They began the night six points out of the eighth and final qualifying spot.

On the tying goal, Umberger showed the puck to Omark and then pulled it back between the winger's skates before stepping into a shot from near the left dot.

Huselius had scored just one goal over the past 13 games and had been a healthy scratch in Friday night's 3-0 victory at Detroit.

Omark pivoted in the left corner near the goal line and whipped quick passes through the crease that Paajarvi converted for the Oilers' first and third goals. It was the first two-goal game of Paajarvi's NHL career.

The teams entered the third period tied at 2 after the Blue Jackets fought back to pull even on Huselius' first goal.

Umberger made a great effort play after Huselius was wide with a shot from the slot. Umberger collected the puck on the back boards, skated to the side of the net and sent a pass back to Huselius, who mishit the puck but it went in off Khabibulin's leg pad.

The Oilers came in last in the NHL with only 15 wins (in 51 games) and 38 points. But they needed just 7:44 to take the 2-0 lead.

After Omark's pass to Paajarvi for the first goal, Penner took a pass from Ales Hemsky and wound up on a hard one-timer from the high slot for his 17th goal while Shawn Horcoff supplied a screen of Mason.

Khabibulin, who had 30 saves, made several nice stops to preserve the lead. But the Blue Jackets finally broke through late in the first. Umberger carried the puck across the blue line along the right boards, then skated laterally through the high slot before unleashing a wrister that trickled in.

Notes: John Moore, a touted 20-year-old defenseman who was the Blue Jackets' first-round pick in the 2009 draft, made his NHL debut. ... Mason had stopped 34 shots on Friday night in Columbus' first-ever shutout win in Detroit.

Quinnipiac defeats St. Francis (N.Y.) 74-60

NEW YORK – Deontay Twyman scored 20 points and Quinnipiac won its third game in a row by defeating St. Francis (N.Y.) 74-60 on Thursday night.

The Bobcats (15-7, 7-4 Northeast Conference) nearly got a double-double out of James Johnson, who had 16 points and nine rebounds. Lance Brown grabbed 12 rebounds as Quinnipiac, whose 41.7-rebound average is fourth in the nation, won the battle of the boards 50-30.

Justin Rutty added 12 points and eight rebounds.

Ricky Cadell led St. Francis with 16 points, but was only 4 of 16 from the field. The Terriers shot 33.3 percent from the field (21 of 63). Travis Nichols added 15 points. Akeem Bennett, who had 28 in Saturday's win at Fairleigh Dickinson, was held to four points, 10.3 below his average.

Quinnipiac committed 18 turnovers to St. Francis' nine, but when it came to scoring off them, the Terriers only gained two points (15-13).

Husband: Giffords would be OK with flight decision

HOUSTON – The astronaut husband of wounded Rep. Gabrielle Giffords said his wife would be "very comfortable" with his decision to go back into space and he expects her to be at his launch in April.

Space shuttle commander Mark Kelly wouldn't go into details about her condition during a news conference Friday, and deflected questions about how he knows she supports his choice to fly.

"I know her very well and she would be very comfortable with the decision that I made," he said.

Kelly took a leave from training after Giffords was gunned down in Tucson, Ariz., on Jan. 8. NASA announced earlier Friday he would resume training for space shuttle Endeavour's two-week mission, which is targeted for liftoff from Cape Canaveral, Fla., on April 19.

When asked if Giffords might be well enough to attend his launch, Kelly said: "Absolutely. I have every intention that she'll be there for the launch. I've already talked to her doctors about it."

It will be Endeavour's final flight and the fourth spaceflight for Kelly.

Kelly said the congresswoman continues to improve in rehab in Houston. One doctor has described her recovery as "lightning speed." She's kept very busy with therapy, a key to his decision, he said.

The 40-year-old Giffords was in intensive care for two weeks in Arizona, with Kelly at her bedside, before she was transferred to Houston for what is expected to be a lengthy rehabilitation. Kelly wanted her as close to him as possible, if he returned to work at Johnson Space Center. He lives in the Houston area with his two teenage daughters from a previous marriage, Claudia and Claire.

Giffords was meeting with constituents outside a Tucson supermarket when she was shot in the head. Six people were killed and 13 were injured in the rampage; a 22-year-old suspect is in custody.

Giffords' wound was devastating, and Kelly, 46, said he initially expected to step down as commander of Endeavour. In the meantime, NASA named a backup commander, Rick Sturckow, who joined the crew for training. Kelly said all along that he wanted his wife's input in the matter, if at all possible.

Though doctors described her early progress as remarkable, they have said very little about her condition, including whether she's able to speak. She was shot in the left side of her brain and doctors have said she had weakness on her right side.

In the first several days after the shooting, she gave a thumbs up and was able to stand with help. She massaged her husband's neck, picked out colors on an iPad and playfully took the ring off a nurse's finger. Friends and Kelly described her as able to understand them.

Her hospital, TIRR Memorial Hermann, last week said it would not provide any more information on her condition. In a Twitter update Wednesday, her husband said Giffords is making "Lots of progress!"

"I'm not going to second guess his decision for anything. I respect his decision, I'm sure it's the decision that Gabby would have wanted him to make and I'm sure he has the support of his family and friends there," said former astronaut Susan Still Kilrain, who gave up her astronaut career when she had the first of her four children.

Kelly — whose identical twin Scott currently is commander of the International Space Station — will lead a veteran, all-male, American-Italian crew to the space station. Scott Kelly will be back on Earth by then.

There's considerable training between now and liftoff, almost certainly with long hours and few days off for the crew. The six astronauts will go into quarantine a week before the launch, with limited access to family members.

"I obviously weigh time that I can spend with her, with what I think is in the best interest of NASA and my crew. So that's a debate I had with myself," Kelly said.

Kelly's mission already was set to be one of the highest profile shuttle flights ever. It will be Endeavour's last voyage and the next-to-last for the entire 30-year shuttle program, and will feature the delivery of an elaborate physics experiment by a Nobel prize winner.

Endeavour was originally scheduled to launch last July, but was bumped into 2011 because the experiment wasn't ready.

Susan Hileman, who was wounded in Tucson, trusts Kelly's decision. She was holding 9-year-old Christina Green's hand when the shooting erupted. The girl was killed.

"I'm sure this decision was carefully made and thoughtfully made, and right for him and for them," said Hileman, who was shot three times. "He's kind and thoughtful and he loves his wife as much as my husband loves me, which is a lot, and we're both lucky women to have such strong men in our lives."

Rabbi Stephanie Aaron, who married Giffords and Kelly in 2007, said the couple has been communicating but she didn't elaborate.

"I think that once he saw that Gabby was so strong and on the mend .... that he made the decision based on, I'm sure, what her wishes would be," Aaron said.

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AP writers Seth Borenstein in Washington and Amanda Lee Myers in Phoenix and video producer Tom Ritchie in Washington contributed to this report. Dunn reported from Cape Canaveral, Fla.

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