So now there is chatter that the Fed is thinking rate hikes, or perhaps just preparing banks for such an event. Spare me! Oh, I know that'll happen, but at the risk of spoiling the economy at this point in time? I sincerely doubt it, knowing what we know about this Fed. Jawboning, lip service...yeah, par for the course when it comes to sentiment. Let's see how the markets react to an idea, first. I still watch the bond market, and while the curve is steepening, and that's something to be concerned with ONLY if growth is inflationary (so far, productivity is very high...so not much of the growth can be considered inflationary unless otherwise). There is too much at risk for getting it wrong, and this Fed received a shock in 2008 beyond belief. I don't see the Fed doing much before 2011, perhaps a bit earlier, but let's remember...it's not ever 'one and done'.
Watch bonds...if prices go up (yields down), all this chatter will go away.
Subscribe to this comment's feed
