The worst-case scenario I see is a major nuclear arms race unfolding in the Pacific. That's not a forecast, that's a logical train of events.

I'm not an expert on the arms race.

If you go on with this nuclear arms race, all you are going to do is make the rubble bounce.

I think that Iran with a nuclear weapon is extremely destabilizing. I think it could precipitate a nuclear arms race in the region.

What is pretty clear is that we will be faced with the specter of another nuclear power which can use their weapons to threaten South Korea, to threaten Japan . . . with every prospect that they will sell some of that plutonium and nuclear bombs to the highest bidder so they might end up in American cities as well.

The FOMC is smiling, as their preferred scenario is largely unfolding.