Longer term real interest rates are dictated by global economic output and the marginal propensity of individuals to save vs. consume, and I agree that the Federal Reserve's ability to impact these rates is limited at best. However, I don't see a much steeper yield curve unless inflation concerns are such that a premium is demanded for holding longer term paper. And right now, the market is saying that although expected levels of inflation are a bit higher than a few months ago, there is little concern that inflation will accelerate to much higher levels.