Fed Hikes Quarter Point, Raises Economic Forecast

As expected, the Fed hiked a quarter of a point. Growth projections are up from December.

The Fed anticipates three rate hikes this year.

Here is a summary of Economic Projections.

The FOMC Statement was pure boilerplate. Nonetheless, mainstream media pored over every word as if it matters.

Here is some nonsense courtesy of Bloomberg.

In another change to the statement, the Fed said inflation on an annual basis is “expected to move up in coming months,” after saying “move up this year” in the January statement.

The statement also repeated previous language that “near-term risks to the economic outlook appear roughly balanced.”

How can any of that possibly matter?

The vote to hike was unanimous. This was a given. Everyone had to support Powell at his first decision meeting.

Economic Wizards

A group of alleged economic wizards sit at a table multiple times a year in a foolish attempt to steer the economy down the right path.

The results speak for themselves: Bubbles of increasing amplitude over time.

Mike "Mish" Shedlock

Comments
No. 1-5
jiminy
jiminy

Strangely, muted reaction given the projections.

Runner Dan
Runner Dan

“A group of alleged economic wizards sit at a table multiple times a year in a foolish attempt to steer the economy down the right path.”
I’m curious to know if any of them look at each other with a twinkle in their eye as if to say, “Can you believe people actually think we know what we are doing? LOL!” and “Nice work old boy, you really are good!”

Rayner-Hilles
Rayner-Hilles

Gentleman. Here's to the economic recovery and sound monetary policy! ...hip hip

stillCJ
stillCJ

Editor

It does not matter what the Fed projects. It does matter what Mr. Market projects.

pgp
pgp

The market is what people say it is. It's just that we live in a time when investors use sentiment in the rhetoric of the central bankers as their economic gauge. Printing money works for a time, sometimes many years... just how long did it take, from the start of the rot, for Rome, Germany or Zimbabwe to fail or more accurately for the confidence in their economies to wane? And confidence isn't the only mechanism in play today. Fear that it will all go TU if malinvestment stops is also driving the collusive corporate, banking and elitist clique to remain "all in" or perpetuate the malfeasance in ever creative ways. Nevertheless there is a limit to just how high housing and stock prices can go, just how much stock a company can buy back or junk bonds a central bank can swallow. What we all need to know is "when and where is that limit?" In a system with as much inertia as the global financial machine the answer could be "a decade"... a point in time when the pain levels felt by ordinary people finally reach some critical threshold.