Awaiting Yellen speech, traders hit the sell button Thursday

Awaiting Yellen speech, traders hit the sell button Thursday

Calamity Janet may try to rectify the damage the Fed wrought last week with its too-clever-by-half non-decision.

Caricature of Janet Yellen.
Caricature of Fed Chair Janet Yellen. (

WASHINGTON, Sept. 24, 2015 – Short column as we await Janet Yellen’s overhyped speech later today. The current Fed chair scheduled to speak up at the University of Massachusetts Thursday. On what, we’re not quite sure.

But we’re sure of this: Grabbing a page out of Hillary’s political playbook, Yellen won’t take any questions afterwards. As if audience questions would make any difference anyway. In any case, traders have been hitting the “Sell” button − hard − since Wall Street’s opening bell.

These days, what should be honest, straightforward, informative policy statements to the electorate from any government official elected, appointed or otherwise, are instead generally a mishmash of Washingtonspeak, that patented, blandly-stated amalgam of important-seeming clichés signifying absolutely nothing unless it coincides with the administration’s daily talking points – otherwise known as bald-faced lies.

A recent ZeroHedge commentary interpreted our non-representative federal government’s frustratingly phony flavor of Orwellian bafflegab this way:

The acceptance of the multitude in rowboats for the few buying new yachts wears thin when the many sense their declining mobility and purchasing power. The illusion that the tide of “prosperity” is lifting all boats is dissipating into a mist that no longer offers cover to obscenely wealthy politicos disclaiming the ugly reality of rising wealth/income inequality.

The question for the chattering classes is this: Will the bread and circuses of sports, random shootings, Trump and the rest of the churn in the media arena be enough to distract those stuck in leaky rowboats from the political fund-raising parties on the grandiose yachts?

As if those grossly overpaid media blowdries and harridans even care. (Bold lettering above via ZeroHedge.)

The Fed’s current talking points seem to be these:

  • All is well and the nation’s economy is majorly improving unless you look at our steadily declining industrial output, which you really shouldn’t do.
  • Unemployment is fast approaching its all-time low, just as long as you don’t count the underemployed, the legion of part-timers who want to be full-timers, and the tens of thousands of people that have exhausted their unemployment benefits and that we don’t count as unemployed anymore. That’s in the U-6 statistics, which it’s our policy not to tell you about.
  • Interest rates are fine where they are, or not, depending on what we’ve had for breakfast. We really should raise them, but hey, why rush? There will be better days to let the high-frequency traders kick off the greatest selling panic of all time, so let’s let that be our little surprise for you. Whenever.

In order to set things right after the mass-selling that greeted the Fed’s non-announcement and punt last week, here is what Yellen should really say during today’s speech:

Since nothing we do is really working right now because we haven’t had representative government for nearly eight years, the Fed has just decided to hold its own here and lie to you about how really, really good things are so you’ll feel better and lay off the constant complaining. To be perfectly frank, we don’t really know what we’re doing right now, which is why we’re making the big bucks. But not to worry. Things are getting better for you every day even though we’re in a severe deflationary spiral that we’ll eventually fix by raising interest rates, just like we did in 1937.

In the meantime, don’t worry about not getting the small business and/or mortgage or refinance loans you’ve been getting turned down for over the last few years. We assure you, all the big companies have been getting their loans all along and that’s a good start. One day, it will be your turn. Soon. Really. We promise.

Trust us. Our economy will be just hunky-dory. Soon.

Take this to the bank.

See you tomorrow.

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Terry Ponick
Biographical Note: Dateline Award-winning music and theater critic for The Connection Newspapers and the Reston-Fairfax Times, Terry was the music critic for the Washington Times print edition (1994-2010) and online Communities (2010-2014). Since 2014, he has been the Business and Entertainment Editor for Communities Digital News (CDN). A former stockbroker and a writer and editor with many interests, he served as editor under contract from the White House Office of Science and Technology Policy (OSTP) and continues to write on science and business topics. He is a graduate of Georgetown University (BA, MA) and the University of South Carolina where he was awarded a Ph.D. in English and American Literature and co-founded one of the earliest Writing Labs in the country. Twitter: @terryp17