On Wednesday, following the two day Federal Open Market Committee meeting, Fed Chair Janet Yellen will likely announce that the Fed will do something they haven’t done in nearly a decade. They will raise the federal funds rate.
Obviously, a lot has happened since June 29, 2006. For example, on June 29, 2007, precisely one year after the Fed’s last rate increase, the first generation Apple iPhone was released. What this has to do with Fed, we really don’t know. But it does offer perspective on just how doggone long it has been since the world has known a rising federal funds rate.
As far as the economy goes, the last 10-years haven’t all been peaches and cream. Several notable disfigurements include the Great Recession, the ignoble disappearance of Lehman Brothers, TARP, trillion dollar budget deficits, the addition of over $3 trillion to the Fed’s balance sheet, seven years of zero interest rate policy, and the addition of over $10 trillion to the national debt.
Yet finally, after much dithering and prevarication, the navel gazers at the Fed have found the power within themselves to ever so slightly ease up on the gas pedal of monetary policy. Continue reading →
On this special day of redemption and reconciliation, we take pause from our usual reflections on the economy and financial markets. It’s Christmas Day, after all. Why not keep things merry?
