Here is an exchange I had this morning with someone I will only identify as the existential economist.
Aren't we cynical? Maybe. Maybe not enough.
EE:
Fed will use this jobs report (+295k jobs) to justify raising rates.
Despite average wage growth falling.
Jesse:
They want to get off zero so that they can cut later on when they fail again. Even if it is only 'symbolic.' I would almost guarantee that this is their game plan.
I wonder if they will increase the rate that they pay the Banks on their excess reserves that the Fed provides? That could be another motivation. They *could* play that a bit. Or maybe using rates to drive investors into riskier assets is just for the little people, and they could just use it to increase the Banks' share in their vigorish.
I do not see the Fed doing anything to help anyone except to help the Banks belly up closer to an ever widening trough of economic distortions, inequality, and malinvestments.
