QT Matters

There is potential that we are heading for a policy error here from the Fed. Granted they were trapped going into this meeting, but the result was more hawkish than the market expected. In the wake of the meeting there is not really much the Fed can say, or do, in the short term to put a floor under the market should it go south. Longer-term they will blink, but it is a matter of sequencing.

The other day I saw a show about this unfortunate woman who had been injured and as a result had been prescribed opioids which she then became addicted to. As her physical wounds had healed, her Doctor would no longer prescribe more and she couldn’t get them any place else. So, she decided the only way to get them was to aim her car at a brick wall and hit the accelerator. Only with a new injury would she again gain access to what she needed. Dr. Powell is making Ms. Market very angry. Let’s hope she doesn’t do something rash…