Investors sometimes remind me of puppets. Pull one string, and that's the way they go. Pull the other, and they stagger right back to where they were. Maybe the Fed is yanking everyones' strings on purpose. If investors are sufficiently confused by an endless stream of conflicting disinformation, they won't react to an approaching significant event, even an obvious approaching significant event, until it's upon them and they're overwhelmed.
In this case, the Federal Reserve leads the whole world to believe that it will make the first of many reductions in its massive monthly bond purchases (aka, "Quantitative Easing") in September. (The Fed doesn't have any actual money of its own, by the way. It buys the bonds with money it just prints... because it can.) It calls this gesture "tapering."
The markets fall significantly.
Then, Ben Bernanke, the chairman of the Federal Reserve, shocks the world by stating that the tapering won't begin in September. He says, 'maybe not until next year some time. Probably not until unemployment falls below 6.5%.'
The markets soar! It's bad economic news, assuredly, but the more important thing to investors is that the artificial vitality brought about by conterfeiting will continue.
Then, James Bullard, President of the St. Louis Federal Reserve, declares that tapering could begin in October - just one month after the date investors were firest duped into thinking tapering would commence.
The markets rise some... then fall some! What to believe? What to believe?
And now, William Dudley, President of the New York Federal Reserve, states that folks shouldn't have been shocked by the lack of tapering - which seems to reiterate Bernanke's original message and contradict Bullard's.
If investors are the mindless puppets I think they are, we can expect the markets to soar today - unless, of course, people are actually wisening up to the fact that you can tell when the Fed is lying to you by watching its lips. If they move, it's lying.
It's clear that the Fed's real strategy is to disseminate so many conflicting messages, that investors' heads spin. If they can't think straight, they won't take any action at all - which is the most that the Fed can hope given the gloomy outlook which is apparent to thinking human beings.
The markets eventually will crash. Reality always gets its way sooner or later. But for now, Bernanke, our beloved President Barrack Maobama, and all the rest of the Asshole Democrats are buying TIME with nothing more than lip service. It's a pretty good deal for them, when you think about it.
N.Y. Fed’s Dudley says markets shouldn’t have been shocked by lack of taper
September 24, 2013, 8:34 AM
There are a lot of hurt feelings out there over the Fed’s refusal last week to trim its bond purchases. Many Fed watchers got it wrong. Obviously, many traders were also on the wrong side of the Fed decision, as evidenced by the immediate reaction across markets from equities to Treasurys to gold and the dollar. To critics, the Fed clearly has a communication problem.
Not so, says New York Fed President William Dudley, a close ally of Fed Chairman Ben Bernanke. In an interview with CNBC, Dudley argued that market participants tend to jump to conclusions:
http://blogs.marketwatch.com/capitolreport/2013/09/24/n-y-feds-dudley-says-markets-shouldnt-have-been-shocked-by-lack-of-taper/
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