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CNBC EXCERPTS: ST. LOUIS FEDERAL RESERVE PRESIDENT JAMES BULLARD ON CNBC'S "SQUAWK BOX" TODAY

WHEN: TODAY, MONDAY, FEBRUARY 28TH

WHERE: CNBC'S "SQUAWK BOX"

Following are excerpts from the unofficial transcript of St. Louis Federal Reserve President James Bullard on CNBC's "Squawk Box" today. All references must be sourced to CNBC.

BULLARD ON POLICY:

"POLICY IS A CONTINUOUS PROCESS SO I WOULD SEE IT AS POSSIBLY SEEING IT AS POSSIBLY FINISHING THE PROGRAM SHY OF WHERE WE INTENDED INITIALLY AND THEN GO ON PAUSE FOR A LITTLE WHILE LET MORE INFORMATION COME IN ON THE ECONOMY SEE HOW IT DEVELOPS AND IF THINGS CONTINUE TO GO AS WELL AS I THINK THEY WILL IN 2011 THEN WE CAN START THE PROCESS OF GETTING THE BALANCE SHEET BACK TO NORMAL AND GET INTEREST RATES OFF ZERO EVENTUALLY.

BULLARD ON THE ECONOMY:

"THE ECONOMY IS DEFINITELY DOING BETTER THAN IT WAS LAST SUMMER AND FALL SO I AM ENCOURAGED BY THAT AND I THINK WE ARE IN VERY GOOD SHAPE FOR 2011 THE ONLY WILD CARD NOW IS THE MIDDLE EAST."

BULLARD ON MAKING ADJUSTMENTS:

"I DON'T MIND MAKING SMALL ADJUSTMENTS BECAUSE TO ME THAT IS THE ANALOG OF ORDINARY INTEREST RATE POLICY, SO YOU MOVE 25 BASIS POINTS AND THEN YOU PAUSE FOR 3 MEETINGS AND THEN YOU MIGHT MOVE AGAIN. I DON'T MIND THAT KIND OF THING I THINK FOR SOME REASON MY COLLEAGUES ARE ENAMORED WITH PUTTING BIG NUMBERS UP THERE AND STICKING WITH THE BIG NUMBERS, I DON'T LIKE THAT AND SO I HAVE BEEN WORKING WORKING WORKING TO GET PEOPLE OFF THAT."

BULLARD ON THE RECESSION:

"THIS HAS BEEN A GIGANTIC RECESSION WE HAVE HAD PLUS ASSOCIATED WITH A FINANCIAL CRISIS WE KNOW IT TAKES LONGER TO COME OUT OF THESE THAN OTHER TYPES OF RECESSIONS SO WE HAVE GOT A LOT OF FACTORS HERE TO WEIGH BUT I THINK WE ARE DETERMINED TO GET THE POLICY BACK TO NORMAL IN A WAY THAT DOES NOT DISRUPT THE RECOVERY."

BULLARD ON OIL:

"I PUT A LOT OF FAITH IN THE IDEA THAT ALL GOVERNMENTS HAVE INCENTIVE TO GET OIL OUT OF THE GROUND AND SELLING ON THE MARKETS SO THIS IS POLITICAL TURNOVER SO BUT THE SUPPLY DISRUPTION WASN'T THAT GREAT AT THIS POINT."

BULLARD ON QE2:

"THE FED'S QE2 POLICY SORT OF RE-EMPHASIZED THAT THE FED WAS COMMITTED TO GET INFLATION AROUND 2% FOR THE U.S ECONOMY. IT WAS NOT GOING TO BE CONTENT TO LET IT GET DOWN TO ZERO AND TO GET INTO A JAPANESE STYLE SITUATION SO I TOOK IT AS A POSITIVE SIGN THAT INFLATION EXPECTATIONS HAVE COME UP."

BULLARD ON STOPPING SHORT ON QE2:

"I WOULDN'T BE ADVERSE TO STOPPING A LITTLE BIT SHORT ON QE2 YOU MIGHT SAY OK YOU ONLY DO 500 BILLION INSTEAD OF 600 BILLION WELL HOW MUCH DIFFERENCE CAN THAT MAKE WE LL NOT VERY MUCH BUT I LIKE SUBTLE ADJUSTMENTS BECAUSE I THINK THAT IS THE GAME WE ARE IN AND WE DO WANT TO SEND A SIGNAL THAT WE ARE CONCERNED ABOUT THIS AND WE DON WANT TO BE ABLE TO UNWIND THE BALANCE SHEET AT SOME POINT."

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