This was a dovish statement, despite the removal of the word “patient”. It is now apparent that the Fed will not raise interest rates unless both the dollar falls in value against the euro and yen; within the context of building U.S. economic strength. However, both those conditions cannot be true. A stronger economy would lead to a stronger dollar; and that will cause earnings growth to continue to plummet, initiate a stock market correction and put the Fed’s inflation goal further out of reach. This should stay the Fed’s hand.
Why Gold Soared Post-FOMC
Likewise, a falling dollar would only become manifest under continued weakening economic data, which would cause the Fed to remain on hold because it can’t raise interest rates while the economy is barely growing; and is currently flirting with recession. The bottom line is the Fed will find it very difficult to raise rates unilaterally and will probably have to wait at least until the ECB and BOJ stop QE. This is why gold soared after the FOMC statement, along with the major averages.
The Carnival Barkers that dominate the financial media applauded Ms. Yellen’s performance at her press conference; saying the Fed had learned its lessons from the past (think 1937) and would not cause another depression within a depression. However, keeping ZIRP in place for another few months, at the very least, after being at zero percent for nearly 7 years, isn’t learning from the past.
Biggest Central Bank In The World Now Scared To Death
The central bank is directly responsible for creating serial asset bubbles during the last three decades and allowed for massive debt accumulation to now reach the point where every developed nation is insolvent and totally addicted to their central banks purchasing virtually every issued sovereign bond.
Source:
http://kingworldnews.com/the-biggest-central-bank-in-the-world-is-now-scared-to-death/
Why Gold Soared Post-FOMC
Likewise, a falling dollar would only become manifest under continued weakening economic data, which would cause the Fed to remain on hold because it can’t raise interest rates while the economy is barely growing; and is currently flirting with recession. The bottom line is the Fed will find it very difficult to raise rates unilaterally and will probably have to wait at least until the ECB and BOJ stop QE. This is why gold soared after the FOMC statement, along with the major averages.
The Carnival Barkers that dominate the financial media applauded Ms. Yellen’s performance at her press conference; saying the Fed had learned its lessons from the past (think 1937) and would not cause another depression within a depression. However, keeping ZIRP in place for another few months, at the very least, after being at zero percent for nearly 7 years, isn’t learning from the past.
Biggest Central Bank In The World Now Scared To Death
The central bank is directly responsible for creating serial asset bubbles during the last three decades and allowed for massive debt accumulation to now reach the point where every developed nation is insolvent and totally addicted to their central banks purchasing virtually every issued sovereign bond.
Source:
http://kingworldnews.com/the-biggest-central-bank-in-the-world-is-now-scared-to-death/
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