The Celeri Journal #107: Fed-Speak; Interpreted

Written by Michael

On June 30, 2020

Global Markets Recap

Since I’m conversant in “Fed-speak”, I probably owe it to you to translate & decipher prepared remarks by Federal Reserve chair Jay Powell. Sidenote: since when did the Fed start doing Monday press confabs. Stay focused, Mike.

Chair Powell: “Output & employment remains far below pre-pandemic levels. The path forward for the economy is extraordinarily uncertain & will depend in large part on our success in containing the virus,” Powell said.

“A full recovery is unlikely until people are confident that it is safe to re-engage in a broad range of activities,” he added. “The path forward will also depend on the policy actions taken at all levels of government to provide relief & to support the recovery for as long as needed.”

“Far below”. Translation: “We’re never raising rates.” The big lie is the Fed manipulates stock prices. Incorrect: it’s the bond market they’re fixated on. #NegativeInfinityRates. Forever.

“All levels of government”. Translation: “We don’t have unlimited ammo even though we keep saying that we do. Congress: wake up.”

Being apolitical & all, it’d be uncouth for the most important central bank on the planet to lecture elected House Representatives that it’s their job to do fiscal policy; not the Fed’s. In other words; we’ve done our work. You take it from here.

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