"If the law supposes that," said Mr. Bumble, squeezing his hat emphatically in both hands, "the law is an ass".
Charles Dickens
As suggested, the Fed said what was to be expected— of a collection of elitist asshats, pampered princes, and supercilious elitist boobs caught in the credibility trap of their serial failures.
Although the credibility trap prohibits their mentioning it overtly, their statement omits all references to the tightening that they have led everyone to expect. So although they exude confidence in their remarks, they must have felt that creeping fear going up their spines, of the broken wall, the burning roof and tower that is characteristic of imperial overreach and folly.
The immediate response from financial television is that stocks are up while the euro is dropping and 'gold is plunging.' Yeah about six dollars. Apparently the prepared reaction was not carried out properly. Well, there is always an opportunity to rig the market reaction tomorrow. One must keep up appearances.
The Fed has been horribly wrong about nearly everything they have forecast and most of the policy actions they have taken as both a central bank and a regulator for the past twenty years. The only group that has put forward a more disreputable and counterproductive performance has been the Congress, and the deeply captured professional class.
Federal Reserve Press ReleaseRelease Date: April 29, 2015
For immediate release
Information received since the Federal Open Market Committee met in March suggests that economic growth slowed during the winter months, in part reflecting transitory factors. The pace of job gains moderated, and the unemployment rate remained steady. A range of labor market indicators suggests that underutilization of labor resources was little changed. Growth in household spending declined; households' real incomes rose strongly, partly reflecting earlier declines in energy prices (ROFLMAO), and consumer sentiment remains high.
Business fixed investment softened, the recovery in the housing sector remained slow, and exports declined. Inflation continued to run below the Committee's longer-run objective, partly reflecting earlier declines in energy prices and decreasing prices of non-energy imports. Market-based measures of inflation compensation remain low (not including food and healthcare and rent and the basics); survey-based measures of longer-term inflation expectations have remained stable.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. Although growth in output and employment slowed during the first quarter, the Committee continues to expect that, with appropriate policy accommodation, economic activity will expand at a moderate pace, (the Fed has not yet delivered the appropriate policy, sticking with a top down, bank-centric approach) with labor market indicators continuing to move toward levels the Committee judges consistent with its dual mandate.
The Committee continues to see the risks to the outlook for economic activity and the labor market as nearly balanced. Inflation is anticipated to remain near its recent low level in the near term, but the Committee expects inflation to rise gradually toward 2 percent over the medium term as the labor market improves further and the transitory effects of declines in energy and import prices dissipate. (There goes the 'real income growth') The Committee continues to monitor inflation developments closely.
To support continued progress toward maximum employment and price stability, the Committee today reaffirmed its view that the current 0 to 1/4 percent target range for the federal funds rate remains appropriate. In determining how long to maintain this target range, the Committee will assess progress--both realized and expected--toward its objectives of maximum employment and 2 percent inflation.
This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments. The Committee anticipates that it will be appropriate to raise the target range for the federal funds rate when it has seen further improvement in the labor market and is reasonably confident that inflation will move back to its 2 percent objective over the medium term.
The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction. This policy, by keeping the Committee's holdings of longer-term securities at sizable levels, should help maintain accommodative financial conditions. (Keep doing what is helping to fuel inequality, and has not been working for about six years now)
When the Committee decides to begin to remove policy accommodation, it will take a balanced approach consistent with its longer-run goals of maximum employment and inflation of 2 percent. The Committee currently anticipates that, even after employment and inflation are near mandate-consistent levels, economic conditions may, for some time, warrant keeping the target federal funds rate below levels the Committee views as normal in the longer run.
Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; Lael Brainard; Charles L. Evans; Stanley Fischer; Jeffrey M. Lacker; Dennis P. Lockhart; Jerome H. Powell; Daniel K. Tarullo; and John C. Williams.
