Markets Call The Fed’s Bluff After Downbeat Data

Markets Call The Fed’s Bluff After Downbeat Data

The Federal Reserve (aka "The Fed") has a parrot problem, and it's on a crash course with economic reality... maybe. The Fed sets policies that impact interest rates in an attempt to keep inflation in check without crippling the economy.  After arguably leaving rate-friendly policies intact too long in 2021, they scrambled to put the brakes on inflation in 2022 with aggressive rate hikes (higher rates leave less money to buy other "stuff," thus hopefully lower inflation by decreasing demand). For months on end, almost every Fed speaker has parroted a version of the same few thoughts: Inflation is too high Rates need to go higher still Once rates are as high as they can be, we need to keep them there for as long as we can We don't mind doing some economic damage if i