Fed Worried Cost of Living Not Rising Fast Enough Ep. 112

Published: Oct. 9, 2015, 12:15 a.m.

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\\n\\t* The Dow Jones finished up almost 140 points - back over 17000
\\n\\t* The Dow has now rallied 1,000 points since its lows on Friday following the lower than expected Non-Farm Payroll number
\\n\\t* The market originally sold off until traders realized that bad news is good news and they bought the dip
\\n\\t* The buying intensified today following the release of the FOMC minutes from the last meeting
\\n\\t* I predicted the markets would experience a rally based on the weak Non-Farm Payrol number
\\n\\t* The U.S. market looks like it\'s standing still compared to the markets overseas
\\n\\t* Now that so many traders are starting to connect the dots and realize that a rate hike is not around the corner we\'ve seen a huge rally in overseas stocks, particularly in emerging markets
\\n\\t* All currencies continue to gain against the dollar
\\n\\t* Silver prices earlier in the week hit a 3-1/2 month high
\\n\\t* Gold got back above 1150
\\n\\t* Oil prices are close to $50/barrel
\\n\\t* All of this is happening because traders are beginning to pare back their rate hike bets
\\n\\t* In light of today\'s release of the dovish September FOMC meeting minutes the trend will intensify
\\n\\t* Why were people surprised by the dovish minutes?
\\n\\t* If you read the minutes, the real reason the Fed did not raise rates is because inflation is too low
\\n\\t* They also said they would risk credibility raising rates below 2%
\\n\\t* Lose credibility with whom?
\\n\\t* If they are afraid to raise rates with inflation below 2%, they why have they been bluffing that they are about to raise rates?
\\n\\t* The official inflation number has been below 2% the entire time they have been talking about a rate hike
\\n\\t* I have been saying that they will continue to pretend to raise rates, but they won\'t
\\n\\t* I thought it was funny that Netflix raised their rates 11% - the Fed must have thought this was good news
\\n\\t* The real reason the Fed won\'t rais rates is that they don\'t want to prick the bubbles
\\n\\t* We have a bubble in the stock market
\\n\\t* A bubble in the real estate market
\\n\\t* A bubble in the bond market
\\n\\t* Auto loans, student loans, consumer credit, art - you name it
\\n\\t* The Fed doesn\'t want the government to deal with higher interest rates
\\n\\t* Look at the headline in the Wall Street Journal about foreign central banks beginning to dump treasuries
\\n\\t* Look at how many treasuries China has sold
\\n\\t* This is the tip of a huge iceberg
\\n\\t* How is the Fed going to end QE when it has to take the other side of the mother of all trades?
\\n\\t* CNBC cited overseas problems washing up on our shore as the reason why the Fed won\'t be raising rates - these are not overseas problems
\\n\\t* The problems started here - they\'re just coming back
\\n\\t* The overseas markets were reacting to higher interest rates and a strong dollar
\\n\\t* This game is going to end - the next time the dollar goes down, it\'s down for the count
\\n\\t* Rather than having foreign central banks coming to its rescue, they are going to be joining in the dollar selloff just like everybody else
\\n\\t* I wanted to comment on an Robert Wenzel\'s article in the Economic Policy Journal
\\n\\t* Wenzel appears to be referring to me but does not mention my name
\\n\\t* Here\'s the title of his piece, dated September 18, following the most recent Fed meeting:
\\n\\t* "The Absurd Idea That The Fed is Not Going to Raise Rates"
\\n\\t* Wenzel refers to "certain so-called Austrians out cheering that they were proven correct in their view that the Fed will not raise rates..."
\\n\\t* Many people commented that he must be referring to Peter Schiff, but he denied this
\\n\\t* Wenzel seems to believe I do not think the Fed should raise rates
\\n\\t* I am not saying what I think the Fed should do, I\'m saying what I think they will do
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