BLS to Fed: Nevermind?

We learned last Friday that that the September jobs number is 110,000 and the dreaded August decline has been revised to an increase of 89,000. While super-bear Nouriel Roubini is not impressed, I think a lot of people are relieved.

I continue to wonder though if the Fed shouldn't be worried more about inflation than unemployment. For one thing, inflation is something they can actually control! For another, quoting from the BLS:

During the first eight months of 2007, the CPI-U rose at a 3.7 percent seasonally adjusted annual rate (SAAR). This compares with an increase of 2.5 percent for all of 2006. The larger advance thus far this year was due to larger increases in the energy and food indexes.

But of course that's not the Fed's preferred measure of "core inflation". No, but core inflation is kind of a weird concept. Here's Daniel Gross in Slate:

Imagine that a cardiologist told you that aside from the irregular heartbeat, the stratospheric cholesterol count, and a little blockage in your aorta, your core heart functions are just fine. That's precisely what the government's cardiologist—Ben Bernanke—has just done.

People aren't really buying it though as Gross also reports that: Each month, the Conference Board asks consumers what they expect the rate of inflation will be for the next 12 months. The figure has been above 5 percent since April.

I wonder if they knew then what they know now, if the Fed would have made the same 50 basis point cut?