While we’re on the subject of Mr. Bullard, the opening segment from this week’s NFTRH (#335) had a little fun with the Fed. Serious multi-market and economic analysis came later, but sometimes you just need to shake your head in awe and wonder.
The Fed is important because millions of market participants believe it is important and a critical mass of people are under the illusion that its policies have put the “Great Recession” in the past and laid a path for a sustainably good economy going forward. In short, confidence in the Fed has never been more pervasive as it reaps the reward (the respect and confidence of the majority) for a job well done.
Bullard: Super hawk gets in blab mode the moment the market begins to crater in October… we can always bring on QE 4!
Fisher: We need to raise interest rates!
Bullard (back in hawk costume, feathers, talons, sharp beak and all): We need a rate hike sooner rather than later!
Evans: No hurry to raise rates!
Williams: Fed should not be too patient on rate hikes (more…)
This is only the second best Fed Hawk photo I’ve ever seen.
Mark Hulbert has a piece this morning at MarketWatch in which he de-correlates the first Fed interest rate hike from any supposedly corresponding stock market movements. I agree with some but not all of what he writes. Let’s take it a chunk at a time.
Investors, it doesn’t matter when the Fed raises rates
Are you obsessed with whether the Federal Reserve will begin to raise official interest rates in July, September or sometime next year?
So Baby 2015 has slammed the book on wrinkled old 2014 (this imagery just cracks me up), a year that featured the continuation of existing macro trends like US stocks up, global stocks wobbling, precious metals weak and commodities weak to tanking.
Personally, I found the year revolting as an honest market participant, but thankfully made like a caveman and simply used my tools to help me avoid the pitfalls of my emotions and logical mind. I try very hard to tune down the Tin Foil Hat stuff, but I continue to be in awe of Policy Central and the depths of what looks to me like depravity that they will stoop to in order to keep up appearances. Reference Operation Twist and its “inflation sanitized” selling of short-term notes and buying of long-term bonds.
Who would’ve thought managing an economy and a financial system could be so easy, so controlled and well, so sanitary? Of course, that was way back in 2011, when the macro began to quake in anticipation of change. An anti-market (AKA gold) was brought under control but good and though the masses would hold tightly to their fear (so deeply ingrained from 2008) for another year or more, 2013 and 2014 saw increasing momentum toward a complete recovery of hurt feelings from the 2008 crisis time frame.
What a glorious global economic gala! Apparently, contracting world GDP growth, monumental sovereign debt loads, ballooning central bank balance sheets, crashing commodity prices, competitive currency devaluations and synthetically suppressed interest rates, as far as the eye can see, are all great tidings to be joyously celebrated throughout this holiday season. Well, at least that’s the takeaway according to the whooping wonderful world of capital markets. Have no fear, all is perfectly in order. Jamie Dimon, Jim Cramer, Larry Fink and Company all have our back. The rest of us mere mortals are simply supposed to stand aside and take their professional word for it, silently sipping the financial establishment’s spiked eggnog until we attain a sheepish state of stupid stupor. After all, the money experts at the Fed are on the case, what could possibly go wrong? (more…)