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Jon Hilsenrath's 530 Word Summary Of FOMC's "Aggressive Tightening Plans"
Nine minutes after the release of the new 'most important' data of the year, The Wall Street Journal's Jon Hilsenrath has unleashed a briefer than normal 530 word summary of what "common knowledge" we should understand from Janet Yellen's latest statement. While the Fed is a little less optimistic about the outlook for economic growth in the short-term, Federal Reserve officials nudged up their projections for short-term interest rates in 2015 and 2016 in a modestly hawkish manner. Taken together, the Fed's new interest rate forecasts imply slightly more aggressive credit tightening plans taking shape in the next two years than previously thought.
Federal Reserve officials nudged up their projections for short-term interest rates in 2015 and 2016 but slightly reduced their outlook for interest rates in the longer-run.
The shifts emerged from the Fed's latest two-day policy meeting. In a statement released after the meeting, the Fed underlined an improving economic performance in the last few weeks and said it would wind down the monthly pace of mortgage and Treasury bond purchases by another $10 billion starting in July, to $35 billion.
Economic activity rebounded since officials last met in April, the Fed said in its official policy statement.
"Labor market indicators generally showed further improvement," the Fed said on an optimistic note. "The unemployment rate, though lower, remains elevated." Officials also pointed to a recent resumption of business investment after a slowdown earlier this year as one source of an improved economic environment.
That tint of optimism follows a dismal first quarter in which the economy contracted, forcing officials to reduce their projection for economic growth this year. Officials now see the economy expanding at a 2.2% rate in 2014, substantially slower than a projected growth rate of near 3% offered last March. Still, the Fed maintained its optimism about a pickup in 2015 and 2016.
Its interest rate forecasts are likely to draw substantial attention among investors.
On average, Fed officials projected the benchmark federal funds rate would hit 1.2% by the end of 2015 and 2.5% by the end of 2016, up from averages of 1.125% in 2015 and 2.4% in 2016 when the Fed last projected rates in March. Over the longer run, officials on average said the target interest rate could settle in at a lower-than-normal 3.75%, down from earlier forecasts of 4%.
Taken together, the Fed's new interest rate forecasts imply slightly more aggressive credit tightening plans taking shape in the next two years than previously thought, but less aggressive beyond 2016. Still, the shift in forecasts can be skewed by changes in the composition of the Fed's policy making committee since the last forecast round in March. Two officials have left and three new officials have joined.
The Fed's new interest rate forecasts arise against a shifting economic backdrop. Officials in their projections for the years ahead see the jobless rate falling more than previously thought.
They see the jobless rate receding to 6% or 6.1% by year end and then to the mid-5% range in 2015 and low-5% range in 2016. Those represented downward revisions from March and suggest the Fed sees less slack in the economy than previously thought, which could help explain the slightly higher near-run interest rate projections.
At the same time, however, the Fed is a little less optimistic about the outlook for economic growth. Officials said the economy's growth potential might be as low as 2.1% in the long-run, the latest in a string of downward revisions made in recent years. That gloomier long-run growth outlook could help explain why the central bank is producing a lower long-run interest rate forecast of 3.75%.
No officials dissented at the meeting. It was the third straight policy meeting this year for Fed Chairwoman Janet Yellen in which there was no dissent.
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Slower than usual. And with fewer words. Hilsie's slippin'.
Hand me the Dramamine.
I don't think Hilsenrath actually writes the articles.
The articles are written by a machine, and they slap his name on the by-line.
http://www.bbc.com/news/blogs-echochambers-26689983
So the Fed said they are tightening $10bn? Does that have anything to do with what the Fed is really doing? What we will know they did five years from now?
Yeah no shit the Fed is tightening to help prop up the US dollar as the rest of the world wants to dump it now!
Because it's either pump up the dollar so the US can still afford it's military dominance
Or we start WW III while we still can fight
Duhhhh!!
They can create the illusion of propping up the dollar while crushing other currencies and backstopping the market.. After all, it is a currency war before it becomes a physical war.
gosh.. it is difficult to reconcile, but..
the noble eagle is just a big bird with a beak that is suited for scavenging carcasses.
.. better to go with the turkey.
I'd go with the rattlesnake. It minds it's own business until fucked with.
That nine minutes is so Goldman $ach$ has the time look it over and position themselves accordingly.
We was too busy packing his bags, on his way to the chopper waiting on the roof.
"Get to da choppa!"
Halfway there, he come face to face with The Predator (Janet Yellen)....
"You are one ugly mutha fucka."
"Step away from the blades son or they're gonna chop your head clean off!"
I suspect they made him type it out by hand, just to throw off the OpEd's.
Let's see if Janet walks the rope today and sticks to just the facts, on the paper.
Actually I hope we see after Stanley a behavioural economics guy become vice chair someday in CAD/UK/US/ECB. The sheer amount of mindgames that must go on pre & post funds debate would write a full textbook of proofs.
fuck you Hilsenrath you ass-licking POS
Gee.. I was about ready to let him blow me, but then that licking accusation discouraged me.
If the FED didn't print money all of our dollars and purchasing power would be overseas due to the huge trade deficits we have with other countries.
The USA is bleeding dollars via trade deficits, so the FED is trying to increase the blood supply to keep the patient alive with QE.
QE and ZIRP are forcing investors out of CDs and savings and into the stock market. Thats the FEDs plan. The FED wont ever let the stock market bubble pop. It will continue to be bullish.
Yep, you are right...this time it's totally different. The Fed will NEVER let the stock market bubble pop...until of course it does.
That's right. Having driven all the life-insurers and pension funds into equities, by crushing long-term bond rates, they will spring the trap by raising them again. It's good that they've dealt with the banking crisis, because there is one hell of pension crisis headed their way.
Otter: "You f__ked up. You trusted us."
On another note...The S&P will break 1950 2day. 4 more points to go!
what took so long?
He didn't take his gingko biloba this morning!
Hey everybody. Things are really looking good. Green shoots everywhere. INflationis under control. Unemployment is down. We fixed this bitch. Come on everybody. Let's go party in Belgium.
Can't too busy buying...I'm going all in BTFATH.
You mean after 7 long years and trillions more in debt, they are still green shoots...they have not even turned into a sapling, shrub or a small stem or something? Tch tch...lets put some more dollars...oops...water....
Oh Wait...they are reducing the pumping and dumping of dollars....so what happens next?
A rise in interest rates is pretty much the end of the world.
That's not overstating things at all. The resulting economic implosion would be swift and lethal.
The Fed is trying to belly-land a plane with no landing gear, no engines, no wings and a full load of fuel.
Nobody is going to get out of this alive.
Don't fret, rates are staying right where they are.
Well they pretty much have to, don't they?
I'm just saying that The Fed talking about raising rates is like you and I talking candidly about how we're going to spend our PowerBall lottery winnings next year.
However the measures they will have to take in order to keep rates down are going to blow shit up in some other way. They are pretending to have a handle on all this, but they don't have anything.
Yes, rate must remain low, period, but if the really stop/slow the printing presses, where oh where would dollars come from in the U.S. Certainly all those outstanding promissory notes outside of the U.S.S.A. won't come flooding back...
oh crap...
C'mon...c'mon...down to the short strokes now...1948 and rising! My whole wad is going to blow @ 1950!
Never go whole-wad-blowing.
Titanic captain's new course is to slightly aggressively change course in the near term, but then transition back to a reduced overall course divergence from hitting the iceberg dead center.
Exactly.
Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium Belgium
BULLHONKEY!!!
The Fed can't tighten monetary policy ANY TIME SOON, OR DISTANT, because the house-of-cards "new economy" will choke to death almost instantly without NEGATIVE real interest rates.
Banana damn republic!
This is why getting a solid 3% return makes one look like a fucking genius...
/s
completely fucked up shit.
bah...buy 'em!
#Obamination
to quote:
"new interest rate forecasts imply slightly more aggressive credit tightening plans taking shape in the next two years than previously thought...."
They are not doing this is a policy choice. They are doing it because they have to. The Fed knows that we know that their policies have not just been a failure but a catastrophe.
Poltical power follows suit and that of the Fed has evaporated, along with others like Draghi and Carney. They are now more concerned in preserving their pensions than the banking system which as their trade union boss is their first and only client.
Meanwhile the banking systems toxity will be resolved by eliminating equity and hair cuts for bondholders.
So who owns the NY Fed again?
Who do I write to find out - none of this "Rothschilds and Lizards" shit, either, I want something on letterhead...
GDP is negative
Labor participation at 1970s levels
Retail for Apr and May were shit
Happy times
The weather was good, everyone was out sitting on their lawns, rather than house shopping.
yeah right! manage dem expectations, it'll mean nothing soon enough...
Seriously, these peeps are simply experts and BS'ng.
Forget this WSJ Bozo, when do we hear from Belgium???!!!!