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FedSpeak sputters

hank
edited October 2022 in Other Investing
Fed's Brainard: “Move with caution” on rates.

These guys all seem to be whistling from the same flute collection. Powell must be the master composer. They’re apparently in the process of shifting messaging from a fast paced Fox-trot to a slower tempo waltz. Something got their attention? Or perhaps they had preconceived notions of how far they’d let markets tumble before bringing out the stops. (Good luck guys.)

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Similar note from Fed’s Charles Evans on CNBC ‘s Squawk Box October 10:

“A little nervous about rate hikes …”

Read Story


ISTM Newton’s first law of motion might well apply here. Or to mix metaphors terribly - It’s a lot easier to start a brush fire than to put one out.

Comments

  • rforno
    IMO trying to parse inter-meeting FedBabble is akin to debating whether the weatherperson is saying the outside temperature is 57 or 59 degrees with greater accuracy. You're better off going outside for yourself and see if it's comfortable enough wearing only a light fleece. (But it makes for solid media punditry....)

    For example, the Fed's "transitory" comment is about as useful as the weatherperson saying there's a "50% chance of rain today."
  • Old_JoeOld_Joe
    There's a 100% chance of babblespeak in financial "forecasting".
  • johnNjohnN
    Eu central banks back up a little today

    Feds speakers hawkish
    Water fall
  • Old_JoeOld_Joe
    Like I said...
  • hank
    edited October 2022
    “Bailey Speak” today. Head of BOE, Andrew Bailey, warned investors today they have 3 days to close out (failing) equity positions before the BOE ends monetary support. Hope I got that right. Picked this up mostly on BB. Can’t even link Reuters anymore. Everything’s going paid subscription. I don’t begrudge publishers. Wish there were some middle ground for community / educational use like this.

    England’s economy is a mess. Inflation higher than here. The pound has crumbled in value - owing partly to the U.S. Federal Reserve’s policies. Their pension funds were suffering big losses on government bonds. BOE tried unsuccessfully to bail them out. Now, in a desperate attempt to stay solvent, pension funds have begun selling equities at very distressed levels. Of course this is driving down asset prices in England and, to some extent, globally.

    U.S. market’s crazy volatile. I tried to place a buy order late in the day at Fido and the price was bouncing around so much I gave up.
  • Old_JoeOld_Joe
    edited October 2022
    Yes, right now Britain is in the midst of a real mess, thanks in large part to the libertarian-influenced changes introduced by Prime Minister Elizabeth Truss.

    Her interest in and links to various right-wing libertarian groups has been known for years, but has not really received much attention currently.

    However, a recent perspective from the New York Times takes a look at her background. Here are some excerpts, heavily edited for brevity:
    LONDON — For the past decade or more, Tufton Street has been the primary command center for libertarian lobbying groups, a free-market ideological workshop cloistered quietly in the heart of power. In September, it stepped out of the shadows. The “mini-budget” presented on Sept. 23 by Kwasi Kwarteng, Britain’s finance minister and key ally of Prime Minister Liz Truss, clearly owed a debt to Tufton Street.

    The plan spooked the financial markets, sent the pound crashing and forced the Bank of England to intervene to halt a run on Britain’s pension funds. It was, in economic and political terms, a disaster — something made plain on Monday when the government, in an attempt to mitigate the damage, scrapped a planned tax cut for high earners. But the package was more than folly. It was the consummation of plans designed on Tufton Street, and of an alliance with Ms. Truss stretching back years. Under her watch, Britain has become a libertarian laboratory.

    In Ms. Truss, they found a friend. After a youthful dalliance with the Liberal Democrats, the new prime minister’s belief in small-state libertarian politics has been a mainstay of her political career.

    Appointed head of international trade, Ms. Truss seized the chance to staff her operation with libertarians. In October 2020, just a couple of months before the start of Britain’s new life outside the European Union, Ms. Truss appointed several pro-Brexit, free-market figures to advisory bodies in her department.

    This battalion of free-market thinkers has now been welcomed into 10 Downing Street. Five of the new prime minister’s closest advisers are Tufton Street alumni, including Ms. Truss’s chief economic adviser and her political secretary, and at least nine Tufton Street alumni are scattered across other major government departments.

    Under Ms. Truss, once nicknamed the “human hand grenade” for her ideological obduracy, the libertarian right has detonated the British economy. The cost, for all but the richest, could be incalculable.
  • carew388carew388
    Now the UK is getting a second taste (Thatcher the first) of the unfettered free-market enterprise bs brand of capitalism we're enduring in the US !
  • catch22catch22
    Hi Old_Joe
    Thanks for sharing the write. I watched her speak several times on Bloomberg and thought that she didn't seem to have a practical thought in her head. She didn't seem to have any connection with the first plans that had been laid regarding taxes and other; and surely didn't connection that to anything as to an impact into the British financial system. But, such is the case for a full blown Libertarian. Not unlike Rand Paul from Kentucky. He decries all the evil programs of the Federal government, but won't say no for aid into his state over the past two years for tornado and flood relief funds .
    'Course, this was a lot like the one way false push into Brexit, and IMHO; how the British votes were mislead.
  • Old_JoeOld_Joe
    Yep! To both of you. :)
  • carew388carew388
    Truss' nickname is the Iron Weathercock !
  • Old_JoeOld_Joe
    I'm really tempted here, but I'll be good for a change.:)
  • BenWPBenWP
    Headline today says Mme Truss is going to fire the Chancellor of the Exchequer. Now that’s a job title that might weigh heavy on a mere mortal.
  • CrashCrash
    BenWP said:

    Headline today says Mme Truss is going to fire the Chancellor of the Exchequer. Now that’s a job title that might weigh heavy on a mere mortal.

    https://www.cnn.com/2022/10/14/economy/uk-tax-cuts-liz-truss-reversal/index.html
  • rforno
    BBG's Guy Johnson on who Kwasi's successor might be: "They need someone who engages brain before mouth...."

    What a s--t-show over there right now, eh?
  • CrashCrash
    Yes. And I've heard the phrase repeated that Truss is "in office, but not in power." Wow.
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