Those Clowns At The Fed Get Way Too Much Respect

August 18, 2016

Picture if you will the Fed governors and their midget boss sitting around a long mahogany table, each in his best Emmett Kelly pastiche: bulbous red noses, scraggly mops of rust-colored hair, size 36 shoes, kayak-sized white lips framed by five o’clock shadow that looks to have been sprouted from a rat’s ass. That’s how I would suggest visualizing the Open Market Committee if you’ve struggled to understand Fed ‘policy’.  With this image in mind, now savor the lead paragraph from Wednesday’s ‘Money & Investing’ section of The Wall Street Journal: ‘Federal Reserve officials are trying to signal that another rate increase is likely while at the same time questioning whether the economy can expand fast enough to justify lifting them much beyond that.  It is a confusing combination that is sapping the Fed’s influence over markets’.

Talk about understatement! We should pity Chelsey Dulaney and David Harrison, the two reporters charged with writing an article that respectfully and without a trace of irony takes the clowns at the Fed seriously. C’mon, guys, say it: The Fed is making it up as they go along. And they’re doing no better at it than would a bunch of sales clerks randomly picked from Nordstrom’s shoe and cosmetics departments.

Can we stop pretending that the minutes of each and every Fed meeting mean something? And can all of the trade-desk wackos just cool it when the minutes are released to the clueless twits in the newsrooms? Here’s the bottom line, something we’ve been saying since Ben Bernanke uttered the immortal words ‘helicopter money’: Any real tightening by the Fed is about as likely as a Martian invasion. End of story. 

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