Federal Repression System

The Fed’s Fruitless Follies
In the Middle of a Massive Monetary Policy Error
How Do You Mess Up the Easiest Prediction in the World?
Dallas, Planning, and Writing
‘However beautiful the strategy, you should occasionally look at the results.’
– Winston Churchill
And from ‘To a Mouse, on Turning Her Up in Her Nest with the Plough’:
Scottish version:
But Mousie, thou art no thy-lane,
In proving foresight may be vain:
The best-laid schemes o’ Mice an’ Men
Gang aft agley,
An’ lea’e us nought but grief an’ pain,
For promis’d joy!
English translation:
But little Mouse, you are not alone,
In proving foresight may be vain:
The best laid schemes of Mice and Men
Go often askew,
And leave us nothing but grief and pain,
For promised joy!
– Robert Burns, 1785
The Federal Open Market Committee, to almost no one’s surprise, did absolutely nothing at its last meeting other than say that maybe, if the data allow, they will raise rates in December. My cynical view on their dithering will be detailed below. And of course, the Bank of Japan met and decided that maybe they had gone a bridge too far; and rather than lowering already negative rates when the yield curve was flat out to 40 years, they decided to see if they could create a fulcrum around the 10-year Japanese bond at zero. So far, the move has not been a rousing success.

This post was published at Mauldin Economics on OCTOBER 9, 2016.