It’s a little early to call an interest-rate top. Maybe two or three or four years too early. However, looking back at the bond wreck since the election, it’s worth putting panic aside and to think for a minute or two. The Fed's Wednesday meeting Working in reverse, the newest panic began after the Fed’s Wednesday meeting. The commentariat consensus has been a “hawkish” surprise in the Fed’s words and charts, in particular the scattergram showing a three-hike 2017 instead of two. A harrumphing “B.S.!” to that. Nothing changed. Fed intentions are as gradual as ever. The forecast attached to its post-meeting statement -- GDP (gross domestic product), inflation, unemployment -- all as-were. The scattergram of the future location of the Fed funds rate has been grossly misinterpreted. Dot-voters include all 12 regional Fed presidents: two are wild hawks with no business within 100 miles of a central bank; two more are permanent hawks; and another pair are newly f...
- The degree of current Fed accommodation is “moderate.”
- Gradually moving toward balance makes sense, but accelerating the process does not.
- Overseas currency moves will suppress U.S. inflation and growth.
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