This is a partial transcript from "Your World with Neil Cavuto," August 8, 2006, that was edited for clarity.
NEIL CAVUTO, HOST: I think I know how my guest feels on that subject. He has never been a fan of Ben Bernanke, the Fed chairman. He opposed his nomination, thinks that this pause in rates might not be enough to undo the damage the new Fed chief has already done.
Senator, they stopped. For now, they stopped. What do you make of that?
SEN. JIM BUNNING, R-KY.: Just temporarily, I'm afraid, Neil.
CAVUTO: All right. So, you're not encouraged. Why not?
BUNNING: I'm not encouraged because they have overshot already.
CAVUTO: What do you think happens?
BUNNING: Well, I think that the Fed and the group that has surrounded the Fed chief, the new FOMC committee, has decided that they have overshot, and they better take a look, because, if they have overshot, you know what happens then — the same thing that happened on Greenspan twice.
When he overshot, the economy went south on us. And we cannot afford to have the economy go south.
CAVUTO: All right. Now, 13 of the 17 rate hikes were done by Alan Greenspan, the last four by the Bernanke Fed. So, are you dumping too much on this guy?
BUNNING: No, I'm not dumping too much on him.
But I thought, with the background he had in the economics, and with all the experience that he is supposed to have had as the chief of the economic advisers and as a member of the FOMC committee prior, that I thought he would be sharper, to find out exactly what we should be doing, and stop the raises at about 5 percent, and then see what happens.
CAVUTO: I remember, Senator, the tone of your question. I don't remember verbatim. But I remember, essentially, you said, the Fed sometimes gets too worked up on fighting inflation, without paying attention to what it — damage it could do to the economy in the meantime.
Are you saying that, at the very least, a slowdown is coming now, or a recession?
BUNNING: No, I'm saying, if — if hindsight is any — is 20/20 — and it usually is — that they have overshot, and we're going to have a — a slight slowing down, thank God that they look in the forward mirror and see no more interest rates.
You know, the — the Fed has been — been fighting a false inflation for the last six months. If you look at wages and things that are really core inflation, we haven't seen much of an increase, only in commodities and energy prices. And those are not things that really cause inflation.
CAVUTO: All right, Senator Bunning, always good having you on. Thank you very much.
BUNNING: Thanks, Neil.
CAVUTO: All right.
Content and Programming Copyright 2006 FOX News Network, Inc. ALL RIGHTS RESERVED. Transcription Copyright 2006 Voxant, Inc. (www.voxant.com), which takes sole responsibility for the accuracy of the transcription. ALL RIGHTS RESERVED. No license is granted to the user of this material except for the user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon FOX News Network, Inc.'s and Voxant Inc.'s copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.