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The "Dots" Chart - Then And Now
Perhaps the one most important, if completely meaningless chart (because it will be revised countless times in the next year and the final outcome will be anything but what the Fed is predicting) that everyone was looking for in today's FOMC forecast materials, is the so-called "dots" - the Fed's estimates of where the Fed Fund's rate will be at the end of 2016. The big picture: the median Fed Funds rate forecast for 2016 was raised from 2.25% to 2.5% which means that preliminary fears about a lowering of the terminal growth rate appear to be, for now at least, overblown.
As for the individual dots, and how they compare to the April statement, here is the chart. For the most part projections went up , hence the increased 2.5% new FF forecast, except what appear to be the uber-dove trio which dragged the lower end lower. To wit: let's all just call the brand new lowered 0.5% dot "Kocherladota".
More importantly, as we predicted a month ago, the Fed just slashed its 2014 GDP "central tendency" forecast from 2.8%-3.0% to 2.1% to 2.3%. And now we wait as stocks soar as one more year is wasted in anticipation of the US economy hitting "escape velocity."
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Growth slowing, spending slowing, rates higher in the future than previously expected = buy everything.
Got it.
It looks to me like the dots are moving up, which means higher interest rates.
And the market is rallying again
Are the machines still plugged in? Never mind
But, they'll be revised down again; just like GDP 'estimates*.'
*Fed GDP Estimate Defined: "A wild-ass guess, carried out to two decimal places."
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perfect
Women on the left, men on the right.
Did I pass the test?
The chart itself is a fail. Unlabeled X-axis. What is that? Tenths of a percent per line? Starting at -2%?
"Women on the left, men on the right."
irrespective of sex, of course.
I can't see the y-axis label either. Could be the adblocker on my tablet, though.
Yeah. Y-axis. That's what I meant. I'm smart. No, really, I am.
Where's my damned nail gun? I'm ending all this right now.
You don't need DOTS, you don't need monetary policy analysis, you don't even need to understand Fed programs all that well. All you need to do is BTFD. That's it. They will never let this market go down again and will match the story to suit the need at the time. Only direction to go is higher.
If the Fed used this as a Rorschach test they would all probably see a flock of sheep getting F'd
this is fukking transparency...in the world of jumbo shrimp!
They'll keep ZIRP because it allows the banks to get money from them at 0.10% and lend it out to sheeple at 4.50%-29%.
They won't raise rates until they are certain the retail crowd is back into equities to the hilt and Wall Street gives them the go-ahead.
Wait until the banks can borrow money from the Fed at NEGATIVE rates. You think you hate it now, but just wait!
MOAR? Oh, yes, please!
It would appear that even some of the most soundly asleep people can understand how the banks are able to build new and larger temples (buildings), all the while paying nothing or next to nothing on savings accounts, CD's, etc.
Indeed...and in 2019 we'll be back to trillion+ deficits, so let's top it off with an additional 3% interest rates. That will make it a cool 1.5 trillion deficit. Then we'll all wake up smell the coffee and be glad we all bought moar stox today since the S&P will be at 3000
If you are in the business of promoting ideologies and moving towards a One World Government, then you have all the time in the world.
If you are trying to maximize your own life, as an individual, you are screwed. Another wasted year down the drain.
And so, the war against the individual carries on.
When was the last time the US economy exceeded the Fed's forecast for economic growth?