Uh. Can I say 'Uh' on something?
Today's Wednesday, right? Last Monday ahead of Tuesday Powell was at a 25bp hike. But at Congress, Tuesday he was hinting to 50bp. This Monday he was back at 0bp and Tuesday back at 25bp and today, Wednesday again, back at 0bp.
I'm sorry but are you ready for this.... That is terrible terrible terrible terrible terrible Fed management. Terrible. You can't run a Fed worse than that. That is just no-way-no-how a way to run a Fed. If any of you ever decide to run a Fed one day, take it from me, don't do that. Lack of consistency is not good and destabilizing for markets. It's a negative. Powell's got to do a better job than that one. Sorry.
But it's also so glaring how little they know about news even a day or two in advance to flip then flop then flip again then flop again. It's unbelievable. Sorry, the Fed gets a terrible grade on this flipflopflipflop. My report card is in the mail to his mom and she's going to need to sign it and send it back. That's how it works.
I know Congress bows down to everything Powell says but maybe this is way too much power for one person to have to be so fickle with so little advanced data. What do you think?
The Fed knows very little more than we do and that's our opportunity.
We have fundamentals, technicals and all the same data as the Fed, real-time. They have no lead on us. Let's continue to use the Fed's lack of know-how and lack of data to our advantage.
It's unbelievable how little fore-view they have. I don't even know if that's a word but if it is, they don't have it.
Back To No Hike For Next Fed Meeting Next Wednesday
Today the WSJ previewed for the Fed that NOW they want no hike.
Today's Fed leak though I actually very much respect. Why? If you remember back Fed Pres Kashkari said the Fed's going to play chicken with markets. That is just wrong. The Fed in my several decades history of Fed (Second Guessing) Watching, the Fed always respected markets. All players need to respect markets. If they don't the markets have a funny way of wiping people out that don't respect it.
We, readers, members, subscribers, chat, we respect markets even if the Fed does not.
But in today's WSJ piece they cited that the CME futures were at 50% chance for no hike which the reporter, Nick Timiraos hints means to the Fed they are now also at 0 hike. I like that. The Fed is so lost, so back and forth, and now so humbled that they lost that game of chicken and are finally finally following the markets, like Feds of old.
"50? 25? 0? 25? PPI CPI, some too small to fail bank, market, please, uncle, let me know what you want, I need a vaca."
Zero. The market wants zero. Ok, zero it is.
Finally this Fed shows some humility to markets.
Conclusion
The market's won this game of chicken versus Fed hubris. Back and forth then back then forth Fed in a short time shows lack of credibility and weakness. The Fed gives in and the market's expected pivot has ensued. Markets have one less headwind now.
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