The Fed Will Raise Rates, Oh Wait No It Won't, Wait, Wait, Yes It Will
Two Federal Reserve officials indicated that the central bank isn’t likely to take its foot off the gas pedal soon.
Federal Reserve Bank of Philadelphia President Charles Plosser said Friday he welcomes the improvement in hiring seen in November, but added he wants to see more improvement before concluding the economy has turned the corner.
“I think that the job numbers are very encouraging” and “it’s hard not to take some good news away from that,” Plosser said. “But I’d emphasize one month does not a trend make” and the story remains to be told what will happen with hiring.
Plosser was speaking to reporters at a conference held by his bank on Friday. Earlier Friday, the government released surprisingly good hiring data.
Back on the shit list, I see, Chuck. That didn't take long.
Separately, Federal Reserve Bank of St. Louis President James Bullard made the case again Friday to keep the central bank’s asset buying program alive beyond the first quarter of next year, to give the Fed extra flexibility in dealing with the economy.
Bullard has been a forceful advocate for the idea over recent weeks, making the case to extend buying of mortgage-related assets beyond the currently announced date. The official says he’d like to keep the effort alive at “low levels” and for the program to be adjusted depending on how the economy performs.
Bullard’s views came from slides prepared for a conference held by the Federal Reserve Bank of Philadelphia. Bullard will be a voting member of the interest-rate-setting Federal Open Market Committee next year.
Positioning ourselves to take over the post Plosser used to guard so well, eh?
In related news (sort of) did you guys know there is an art-porn star also named James Bullard? Must make things rough for the St Louis media team. "No, no, this is THE FED, you know, like WE PRINT YOUR MONEY and inflate bubbles, not that other stuff." I'm not sure about them but sometimes yours truly gets the two confused. Come on. Endogenous firm entry? These economists are asking for it.
Anyway, a day later WSJ says the unemployment report might inspire Fed officials to finally make a move on interest rates. Sure, I buy that, Bernanke-san.
For as much as Plosser has vacillated between my good side and my shit list in recent weeks, call me crazy but I feel a major Fed market jerk off coming on. Look, even my very favorite Fedhead is throwing bizarre statements and speaking more like a stunt double than his actual self just days after making Bernanke look like a punk. WTF are you boys doing over there? We get it, there's no trying to pretend like you don't have an exit plan.
So what is it? Do they think no one's noticing? We saw what you said, Bullard. And Chuck, I'm not sure what the hell you are doing but I'm writing you off for awhile until you can get your mood stabilizers adjusted.
Meanwhile, I still haven't seen an exit plan. How's that reverse repo strategy working out?