The Eccles Building trotted out Vice-Chairman Stanley Fischer this morning. Apparently his task was to explain to any headline reading algos still tracking bubblevision that things are looking up for the US economy again and that Brexit won’t hurt much on the domestic front. As he told his fawning CNBC hostess:
‘First of all, the U. S. economy since the very bad data we got in May on employment has done pretty well. Most of the incoming data looked good,’ Fischer said. ‘Now, you can’t make a whole story out of a month and a half of data, but this is looking better than a tad before.’
You might expect something that risible from Janet Yellen – – she’s just plain lost in her 50-year old Keynesian time warp. But Stanley Fischer presumably knows better, and that’s the real reason to get out of the casino.
What is happening is that after dithering for 90 months on the zero bound the Fed has run out the clock. The current business cycle expansion – as tepid as is was – is now clearly rolling over. So the Fed has no option except to sit with its eyes wide shut while desperately trying to talk-up the stock market.
This post was published at David Stockmans Contra Corner by David Stockman ‘ July 2, 2016.
Recent Comments