Volatility finally visited the stock market last week after the dullest summer in two decades as the hydra-headed federal reserve played Hamlet regarding its intentions regarding interest rates.
That description of the increasingly feckless Fed may constitute a mixed metaphor, but that is a small sin compared to the damage the group of former tenured economics professors are inflicting on the US economy with their policies.
The liberal (and clueless) mainstream press is criticizing Donald Trump for calling out the Fed for its destructive policies, but as a businessman who understands how the real economy works, he is correct to point out that more than 8 years of zero interest rates and trillions of dollars of bond purchases have distorted markets, increased income inequality and failed to ignite economic growth.
It is time for the Fed to move to normalize interest rates and allow markets to operate freely.
Unfortunately, there is little chance that it will move this month to raise interest rates…
The Government and Media Are Utterly Delusional
The Fed lacks the intellectual acuity or moral courage to stand up to narcissistic and cowardly equity investors who run for cover at the first sign of higher rates.
The Fed funds futures are pricing in only a 22% chance of a measly 25 basis point hike, which sits at an abysmal 0.25% to 0.50% (and people wonder why banks are reluctant to lend money on which they can't earn a decent return).
That is likely 22% higher than what is going to happen as long as the Fed is in the hands of people like Janet Yellen and Stanley Fischer who actually think that there is no inflation and that the unemployment rate is really under 5%.
America, you see, doesn't merely suffer from an economic deficit; it suffers from a profound moral and intellectual deficit among its political and policy classes. And those of us who call them out are demonized by the mainstream media.
But all you have to do is look at the facts instead of the distorted and politicized nonsense spewed out by the government and media to understand what is really going on – which is that the country is drowning in debt and stupidity.
