My two favorite Powell quotes from yesterday’s senate testimony: “I don’t see us wanting to run through the bond market like an elephant snuffling out price signals and things like that” and “We want to be there if things turn bad in the economy or if things go in a negative direction.”
Without question, the Fed has snuffed out price signals in service of keeping “things” from going in a negative direction. Translation: we have and will continue to manipulate bond yields (and currencies, volatility and oil prices) whenever necessary to prevent (1) yields that would otherwise spike higher from bankrupting the country; and, (2) stocks from falling.
Look for more of the same doublespeak today.
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