This statement off the heals of 'downside outlook diminished since last fall.'
I am a fan of the Fed, and Bernanke, but this is now the second statement where their verbiage contradicts and goes against economic realities.
Markets care about the weight of the Fed word. It's an important tool. Especially as we may need it incase China give Asia a credit shock. Thereby hurting the global markets. But statements like today, render this tool worthless.
Their 'monitoring for months' is no surprise, given the 6.5% unemployment rate target. (It must be getting very hard to phrase these statements.)
The biggest risk the fed has now is whether or not the markets get tired of the word smithing. With treasuries selling off, and equity markets declining, that risk maybe very real.
(Although at current levels, both treasuries and equity markets, were expecting a lot.)
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