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Hilsenrath Confirms Hawkish Fed Sees Q1 Weakness As A Blip, June Liftoff Possible
Federal Reserve officials meeting in late April doubted they would be ready to raise short-term interest rates by midyear, according to minutes of the meeting released Wednesday.
Fed officials are trying to make sense of a first-quarter economic slowdown. Many at the April 28-29 policy meeting believed temporary factors were holding the economy back. Before they lift rates, they want to be confident growth is on track, unemployment will keep falling and inflation will gradually rise toward their 2% goal.
The minutes, released with the regular three-week lag, showed that only a few Fed officials thought they would have enough confidence those conditions would be met by the June 16-17 meeting.
“A few anticipated that the information that would accrue by the time of the June meeting would likely indicate sufficient improvement in the economic outlook to lead the Committee to judge that its conditions for beginning policy firming had been met,” the meeting minutes said.
“Many participants, however, thought it unlikely that the data available in June would provide sufficient confirmation that the conditions for raising the target range for the federal funds rate had been satisfied, although they generally did not rule out this possibility.”
Many Fed officials began the year believing they might start raising short-term interest rates from near zero by midyear, but the winter slowdown has sidetracked their plans. The Commerce Department reported last month that the economy expanded at a small 0.2% annual rate in the first quarter and many analysts expect that estimate to be revised down. The second quarter is off to a mixed start.
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Fed officials and Fed staff were generally upbeat about the medium-run outlook, even though the economy had clearly stumbled in the first quarter. Fed staff, according to the minutes, revised up its growth outlook because the dollar had weakened—which could help exports—and interest rates were expected to stay low longer than previously expected.
Many officials wrote off the first-quarter stumble to temporary factors.
“The severe winter weather in some regions had reportedly weighed on economic activity, and the labor dispute at West Coast ports temporarily disrupted some supply chains,” the minutes said.
“Furthermore, a pattern observed in previous years of the current expansion was that the first quarter of the year tended to have weaker seasonally adjusted readings on economic growth than did the subsequent quarters. This tendency supported the expectation that economic growth would return to a moderate pace over the rest of this year.”
However longer-term factors might also be at play weighing on growth.
“A number of participants suggested that the damping effects of the earlier appreciation of the dollar on net exports or of the earlier decline in oil prices on firms’ investment spending might be larger and longer-lasting than previously anticipated,” the minutes said.
Since the April meeting, Fed officials have confronted a mix of economic data. Though job growth picked up in April and the jobless rate declined, some indicators of economic output—including industrial production and retail sales—have been disappointing. In the process many private forecasts have revised down their estimates for second-quarter growth.
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Putin and/or the weather are responsible.
Full image of Rocket Chair Woman:
http://www.funnyjunk.com/funny_pictures/3659832/Rocket+chair+woman/
Putin is so smart. Maybe he'll run against Hillary. We can only hope.
No, it's just another non stop transitory temporary "blip" that has been ongoing for seven years...
Like some kind of super meth head...
Putin will be ineligible to run for that office until such a time as they photoshop him a Hawaii birth certificate.
"Many at the April 28-29 policy meeting believed temporary factors were holding the economy back."
Yeah like over capacity in every sector, globalization, immigration, debt, and over regulation, but otherwise this eCONomy is ready to take off..... any minute now..... still waiting.
same script as the taper talk.......manage everyones expectations and do the opposite so they can get the best bang for their buck......NO june rate hike because they will have everyone expecting it, s&p, bonds gets a giant boost, dollar gets whacked.
Everyone is earning less, the population is skewing toward the decrepit end of the spectrum, young people are all living in their parent's basements with a massive student loan hanging over their heads and we're staring down the barrel of, oh, about $150 Trillion in entitlements coming due the next couple decades. I can't imagine how the economy wouldn't be growing like crazy in such an environment. It truly defies reason.
" It truly defies reason."
You forget, we're exceptional. Math doesn't apply to us.
"over capacity in every sector," -- LOL, yes. Tell me, what is the overhead on a bullshit digital/paper promise or financial product created out of thin fucking air?
Issued with light-speed typing and proofing, The Wall Street Journal's Jon Hilsenrath explains what we should think about the Fed's minutes...
The jew POV, 4 your convenience... Don't worry, we'll do all GOD'S WORK (so you won't even have to lift a finger ~ unless you're CH1 waiting in the mezzanine to junk a comment)
Still feeling the supply disruptions in global shipping from the West Coast Port strike. Recently suffered through 3-4 week delays myself that were explained to me to be "due to port congestion" .... and this is stuff coming from Europe into the Gulf Coast. The log jam must back up 3/4 of the way around the planet.
Or someone is yanking your lariat.
Citing weather as a reason to change monetary policy is fucking pathetic. How can anyone take these theiving fucks seriously?
The twisted logic of the equity markets is staggering. Fed basically saying economy is too fragile to raise rates from zero to 25 bps in June. Stocks at all time highs.
June will be the Fed's Volcker moment. the current batch lacks the balls to do what Volcker and friends did, and will pay dearly as a result.
the well of hope is running dry. tic, toc, tic, toc...
let that sink in. six years later (six years!) and raising rates just 25bps is cause for panic.
"We will continue to steal from savers and responsible, hard-working Americans, so we can backstop the criminal, TBTF banks and the sleazy crimelords that run them." The Fed
FOMC ---> Dumb and Dumbest
Exhibit A
June 2008 FOMC meeting
revised ... UPWARD ... H2 2008 GDP growth
Hilsenrath ignores the conclusions: inflation moving positively toward 2%
Just more WallStreet market manipulation by a WallStreeter.
"Members of the FOMC who were present at the meeting also consuited their magic-8 balls to determine precisely the correct time to raise rates..."
June 9th, 2008 – Bernanke: Despite a recent spike in the nation's unemployment rate, the danger that the economy has fallen into a "substantial downturn" appears to have waned,
im starting to believe its not gonna be at a meeting that they hike rates. they don't want to because they can't. stock market going to have to start going up 3% a day before it hits them in the face. until then, its up, up, and away. algo-runaway-pandemonium is what i now believe is gonna be the decisive factor for them to raise rates at an intra-meeting call. they've been able to lie about inflation on everything else up until this point but if the stock market were to spiral out of control to the upside to to zero offers, then they raise rates and absolutely break shit. outside of the "crisis of confidence in the fed" scenerio (which i have never had any because im still trying to identify a bubble they "detected"), im not sure whats going to get these pension managers, long only guys to lay-off the buy button. defaults in bonds? possibly. but with central banks around the world buying sovereign paper with $$$ that doesn't exist, chances are they'll suck up all the dead paper & just stick it in a "bad bank"
Yellen and the rest of the doves will never raise rates. There will always be an excuse not to raise. They view the rallying stock market as an affirmation of their policies.
FED rates hile is like the Greek default.
It will probably take forever.
So the Fed juices the market to make everyone feel rich, and then because everyone feels rich they can raise rates. Got it.
Hilsenrath is the Fed's "fluffer."
The moment the EUR reaches parity with the USD that's the day the FED will hike rates - for the moment sit back, relax and enjoy the summer. I am off soon!
When does reality catch up to these criminals? The day of reckoning can't come soon enough.
June liftoff as millions of teachers hit the street, millions of graduates start looking for jobs, Wall Street goes to sleep, millions take off for vacation, .gov spending slows, and America awaits it's first Triple Crown winner in 38 years.
The 'data' is goalseeked.
It is pointless to debate the Fed's 'feelings' about the data...as they have more to do with what was for dinner, and the quality of illegal popular pharmaceuticals, than with anything economic.
The bottom line is that Rates must rise now, so that QE can be declared a success and rolled out again by October-November.
If liftoff and explosion on the launch pad are the same thing then yes there will be liftoff.
The fed does not want a sustained market sell-off while Obama is president. If they can't find a way to nudge rates higher without a bloodbath, they won"t. If the collapse were to occur on the first day of a new Republican administration they would be quite pleased.
Here you Fed morons. Between your policies and Obamacare and inflation and stagnet wages the "people" have zero disposable income after essentials and unplanned "emergencies". What is amazing is the cluelessness of the "political class" and their corporate handlers who are shooting themselves in the head racing to leap frog each other into the destruction of this fine country.