The Clown Show Has Come and Gone
The opening segment from this week’s edition of Notes From the Rabbit Hole has a little fun with the post-FOMC market situation. Unfortunately, there is all too much reality in this clowning around. From NFTRH 387:
Our main theme has been that the ironclad post-2011 confidence in the Federal Reserve among conventional market participants would slowly but surely start to fade because macro parlor tricks, so vigorously employed by the Bernanke Fed, were only tricks or in some cases (Operation Twist) borderline magic, after all.
At biiwii.com (still unsure if or in what capacity the site may reappear) we used to have fun with clown car videos, as the various Fed members piled out honking horns, doing somersaults and shouting incomprehensible phrases and announcements.
Like Rosco’s clown car above, that is all fading away now. The pretense that the Fed is the steward of a sound financial system and currency has been stripped away. We are no longer anticipating a waning of confidence. In rolling over last week and playing dead, the Fed announced for all the world to see that it is no more secure or respectable than the clown known as ‘the Draghi’, Kuroda the Klown or the troupes in Canada, Australia, England and China’s Central Planning.
The US Fed, through no good work of its own was the beneficiary of a Goldilocks environment in which global economic pressures resulted in capital flight into the US.
