Stocks Surge As Yellen Goes Uber-Dovish, Says "Fed Short Of Reaching Employment And Inflation Goals"

Tyler Durden's picture

As if there was any surprise that Yellen was fundamentally an uber dove, she just confirmed it. Here are the key highlights from her speech from Bloomberg.

  • YELLEN SEES `CONSIDERABLE SLACK' IN ECONOMY, LABOR MARKET
  • YELLEN SAYS QE TAPER DOESN'T MEAN REDUCED STIMULUS COMMITMENT
  • YELLEN SAYS ECONOMY, JOB MARKET `ARE NOT BACK TO NORMAL HEALTH'
  • YELLEN SAYS FED SHORT OF REACHING EMPLOYMENT, INFLATION GOALS
  • YELLEN SAYS POST-CRISIS LABOR MARKET STRENGTHENED CONSIDERABLY
  • YELLEN SAYS FED TAKES ITS 2% INFLATION GOAL `VERY SERIOUSLY'
  • YELLEN SAYS DECLINE IN JOBLESS `GRADUAL BUT REMARKABLY STEADY'
  • YELLEN SAYS ECONOMY NEEDS EXTRAORDINARY SUPPORT FOR `SOME TIME'

And more from BBG:

  • Yellen says that despite steady progress, there’s no doubt “that the economy and the job market are not back to normal health.”
  • Fed’s “extraordinary commitment” to help economy recover “is still needed and will be for some time,” Yellen said in a speech at 8:55am local time in Chicago; “I believe that view is widely shared by my fellow policymakers at the Fed”
  • Tapering is “not a lessening of this commitment”
  • Fed is “still considerably short” of full employment and price stability
  • FOMC estimates unemployment rate consistent with full employment is 5.2%-5.6%, well below 6.7% unemployment rate for Feb.
  • Inflation is well below 2% long-term goal
  • It’s appropriate for Fed to continue providing “substantial help” to labor market, without adding to inflation risks, because of signs of considerable slack in economy
  • Decline in unemployment rate hasn’t helped raise wages for workers
  • Job market is in some ways tougher now than in any recession
  • Long-term unemployed face big challenges; research shows employers are less willing to hire them
  • There’s hope significant share of long-term unemployed will benefit from stronger labor market
  • Significant amount of decline in participation during recovery appears to be due to slack, a sign that Fed’s help can still be effective
  • Surveys show consumers and owners of small- and medium-sized businesses remain cautious about strength, durability of recovery

And the punchlines:

  • Numbers of people trying to find work for more than 6 mos. or a yr are higher now than any time since records began 
  • Lower participation rate may mean 6.7% unemployment rate is overstating progress made in labor market 
  • Pool of 7m people who work part time and want full-time jobs is much larger than should be expected at 6.7% unemployment rate; this is sign that labor conditions are worse than unemployment rate indicates  

Gee: who would have thought that the employment data used for Obama propganda purposes does not suddenly suit the Fed, whose Russell 200,000 target is in jeopardy of falling short.

And sure enough, the only thing that matters for algos is that their interpretation of Yellen's rehash of the same comments heard thousands of times already, is that more stimulus from the Fed, i.e., the long-awaited untaper, may be just around the corner. And stocks surge because the Chairmanwoman just admitted the economy is, gasp, weaker than expected.

 

Behold the great and powerful Oz...

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GFORCE's picture

How's the fade working out?

Oh regional Indian's picture

The number of levers, locally and globally that are controlled by a single, small group of people makes this the MOST RIGGED game ever.

Yet, similarly, fractally, at every level, there is a trap door out.

Personally, finaicially, socially....

We choose to ignore the big X on the trap door because the un-controllable slide of letting go that follows scares the heck out of us.

Anyone else done one of those super high water slides? Vertically down?

ori

http://aadivaahan.wordpress.com/2014/03/23/my-tedx-talk/

HoofHearted's picture

So how do we fight all this crap the Fed is doing with our unperformance?

Me...I built another chicken coop, am working to figure out how to have less work to do in getting the manure ready to go into the garden and the actual transfer to the garden as fertilizer. We've planted more fruit trees and berries. We're working on a bigger garden so that we can help out more of our neighbors when things get bad. I'm also trying to figure out how to get cattle without having to drive too many fenceposts. And more than that we are banding together with our great neighbors, helping them on projects and accepting help on ours. We're building community against all the corruption.  

I've also been teaching my children how to use a rifle in case the people coming to seek food out in the boonies aren't friendly and want to take rather than partake in making things better. 

How do you suggest that we go about fighting all this BS? 

Oh regional Indian's picture

Hoof, rubber hit the road time isn't it?

All I can tell you is what I've done, because, hard as it is swallow, and as esoteric as it may seem, as above, so below, as with-in, so with-out. Oldest hermetic truism.

Your outside completely reflects your in. I've had that lesson drilled into my head via my life journey.

So, in a world rushing, I slow down. By slowing down my breath. 

In a world fighting, I fight my-self. Push my-self, challenge myself.

We are th eonly thing we really own and can change. 

A practical thing, I have not had a mirror in my house for 4 years now. Mirrors are strange things, I'll say no more here. If you have them, cover them for a week and see what happens.

And when I want to inflict change on myself, I don't usually see what I can add (like an extra routine or a food ingredient), I look at what I can take away.

The more I can do without, the less any one/thing/circumstance has power over me.

Hope that helps.

It's all internal.

ori

TruthInSunshine's picture

"It invests all its fiat into Priceline, King's Candy Crush Saga or Lululemon, or else it gets the NIRP hose again."

- Janet Bernyellen

*The palliative "highly accomodative" jawboning of a Druish Princess lording over a dying real economy, in real time.

Vampyroteuthis infernalis's picture

And the punchlines:

Why am I not laughing? Where's the kool-aid?

Deathrips's picture

Independence comes from within, there is no external solution. Even though the puppet on the boob tube tells you you need them ...to "change".

 

Personal Independence!!!

 

RIPS

hobopants's picture

Wizard? more like one of the flying monkeys.

NotApplicable's picture

I spent the weekend rebuilding the fence around my garden, and harvested lettuce and spinach from my cold-frame that I planted in January (a first for me). Next weekend I'll get the soil turned in the garden and put my high-tunnel hoop-house ("Fukushima Dome") back up for season four of Cesium free veggies.

Hopefully, I'll get my goat pen reinforced too, as my champion jumping goat is currently keeping many spring flowers in check.

Headbanger's picture

The real message then is QE and Obama are complete failures and the economy is a lot worse than ever so get the fuck out now!

The Federal Reserve will destroy itself  and the entire US financial system if it stops tapering now and continues expanding its balance sheet

Obama will start a real shooting war with Russia now to save his political ass and start the process for forcing his third term.

NihilistZero's picture

You really think Obama wants a third term LOL?  He's counting the days until he loses the Congress so he can blame the GOP for all the countries ills.   You're right about the taper though the dovish speak to the markets is akin to a nurse rubbing a patients head telling him "It's okay" while preppping him for surgery.  The leg is coming off to save the patient...

 

TideFighter's picture

"I like it, I love it, I want some MOAR of it!"

SilverIsKing's picture

Gold and silver are reacting to her comments as you might expect.

The PM algos are in good working order. They only go one way though.

XenoFrog's picture

I just put in sell orders for the last of my stocks. I've got a creeping feeling that this pump may be one of the last before the massive dump.

derek_vineyard's picture

ive had that feeling for 4 years and been dead wrong and here i am reading zh, when i coulda bought stocks and been on a vacation island.....vacation islands are overrated, being debbie downer is more fun

j8h9's picture

Completely agree. Money sitting on the sidelines waiting for the big correction that never arrives. Thankfully I have some money in the market but my blind co-workers who don't know much of anything are reaping huge gains on their 401Ks while half my money is sitting in cash. Soon will be time to go all in and take the risk else I'll be eating cat food in my 70s.

bagehot99's picture

The big correction probably WON'T come while the printing continues. It's hard to see how the Fed can EVER take out $50B/month from the markets and not trigger a collapse. I begine to think we could simply follow Japan and stagnate for decades while the wealthy keep taking their 15%/year asset growth.

Tinky's picture

Not a snowball's chance...

GeorgeHayduke's picture

I am leaning your way too. Many other factors beyond the Fed's digital printing press for their buddies are stacking up to the toppling range. I know I've been surprised by how long they have drug this out so far, but other players are finally making their moves. This may be the summer that the global economic/currency wars finally boil over and casualties start showing up quickly and closer to home than in the past few years. We shall see.

LawsofPhysics's picture

Okay, I'll bite.  If people sell (who's buying aside) where will they be putting all that fiat? 

Do tell...

War_is_Peace's picture

"...where will they be putting all that fiat??"

 

In the bank...where it will be dutifully redeployed as loans that meet the risk tolerances of their respective institutions.  If the events of recent years taught us anything (TBTF), it's that the banks can take all the risk they want!!!  It doesn't matter if the loans go bad...they'll just debit depositor accounts if they are at risk of failing. 

(Page 10)

http://www.fdic.gov/about/srac/2012/2012-01-25_resolution-strategy.pdf

LawsofPhysics's picture

So, kill the dollar it is then...

 

full "faith and credit" bitchez..  If the Fed is going to backstop all risk with dollars, then that where all the risk is and people will leave the dollar (i.e. no faith=no more credit motherfucker).

Deathrips's picture

He who goes bk with the most fiat debt ...wins.

Was there ever another plan?

According to them "poor" people cant afford debt. Fucking retards! Everywhere!!

RIPS

Lewshine's picture

Xeno, that's the most ridiculous statement I've read all day. How and why could you arrive at a sell off in equities when in the last 5 years - EVERY dip has been pumped by the Fed?? Either get out for the purpose of locking up gains...OR, preparing yourself to buy the next dip. But, to say you think a big swoon is coming is utterly fucking stupid, or you've been living under a rock for the last half decade. THE FED WILL NEVER ALLOW THIS MARKET TO COLLAPSE, UNTIL THEY LOSE CONTROL - AND THAT WILL HAPPEN WHEN NO ONE SEES IT COMING. GOLD WILL SEE 800.00 THIS YEAR AND THE DOW WILL EASILY SEE 20,000. BECAUSE CRIME DOES PAY AND CHEATS AND LIARS ARE IN CONTROL OF EVERY ASSET CLASS ON EARTH AND HAVE NO REPRISAL TO FEAR. NOTHING IS LEFT TO CHANCE WHEN A WORLD POWER'S WINDOW DRESSING IS AT STAKE.

Rathmullan's picture

That took less than 2 months and some whinning over her first fed meeting decision. They'll be printing at a run rate of, at least, $35 billion per month going into next year.  

ParkAveFlasher's picture

Print, Mushmouth! 

HoofHearted's picture

Who would have ever figured this out? Oh yeah, all you bitchez here. 

She's painted into a corner. There's only one thing to do...extend and pretend as long as possible while making sure to buy an island where the plebes can't get to you when SHTF. That's what Bernanke did, right? Oh, that and give $250k speeches. 

NotApplicable's picture

Well, lucky for her, the taper is double-edged, as it no longer means a reduction of stimulus.

The way these people destroy language, I wonder how long it will be until they merely point at pictures and grunt forcibly?

Yellen: 'I didn't get a "harrumph" out of that guy!'

LawsofPhysics's picture

The Fed is a private bank.  It will do what is right for it's owners, period. 

 

The wealth transfer (theft) will continue.  Nothing short of guillotines changes that now.

khakuda's picture

Exactly why it is so hard to hear them contiunally saying that their actions are all an effort to help little Jimmy find a good job.

Stoploss's picture

.     .

  0

buzzsaw99's picture

the looting will continue. that is all.

TheRideNeverEnds's picture

[spoiler] they will never reach their target

fonzannoon's picture

It's important that she said this. The economy needs this reassurance that rates will stay low for an extended period and stimulus will be continued and possibly increased. You actually have to give her credit for being consistent with her message.

It's also good she reiterated that the taper will continue at the same pace and be done with by October. Even more important that she gave us an estimate of 6 months after that for when we can expect interest rates increases. The market needed that clarity. You actually have to give her credit for being consistent with her message.

ParkAveFlasher's picture

Yeah, I give her credit for this too:

  • FOMC estimates unemployment rate consistent with full employment is 5.2%-5.6%, well below 6.7% unemployment rate for Feb.
  • Inflation is well below 2% long-term goal

Gave me that little kick of rage that I so desperately need on a Monday morning.

And she is only showing the hand as it has become painfully obvious that her ilk has been actively deceiving American citizens who would be deceived with her tripe.

I suppose that you have to give her credit for swiping Phil Donohue's wig for her job interview, and putting on a good show.

EDIT: get da fkuk outta here, Tommy, Tommy, you really are a funny guy!!!

101 years and counting's picture

Give her credit?  She's a fat windbag that truely has no clue what the fuck she's doing.  She's reading a script handed to her by her TRUE employers. 

fonzannoon's picture

First of all she is not fat, she is big boned. It's a glandular problem.

Secondly, I truly love the junks. I see a few people can't understand the disparity of her own remarks and my sarcasm in playing them against each other. Amazing 5 years into this how many fucking dummies are still out here.

Parkave I junked myself because apparently I don't amuse people anymore. I see my sarcasm refresher did not help the other day.

buzzsaw99's picture

i thought your account had been hacked.

ParkAveFlasher's picture

I got the edit in before you came clean.  Just want to put that out there for the record.

NoDebt's picture

Some of us got it.  I was reading it and thought "Fonz is channeling the ghost of MDB."

Hindenburg...Oh Man's picture

I got it right away. Thanks for the chuckle. 

SilverIsKing's picture

I give her credit for being able to say the things she says with a straight face. That's all.

El Hosel's picture

The rigged market needed that, well, that makes all the difference. What a joke, its all smoke and mirrors, and we have MOAR if needed.

Now the "Market" can fade to unch, rally back to green the last 20 minutes before the close.

Ness.'s picture

The ecomony sucks soooo fucking bad that we must buy stocks to save it!!  Do your part Amurika.

nickels's picture

And to better understand the Fed's revival of the economy, read "Pet Semetary".