WASHINGTON, Sept. 17, 2015 – Instead of our favorite “Waiting for Godot” portrait, we’re featuring Wall Street Journal reporter Jon Hilsenrath’s portrait here this morning. For years, now, he seems to have been serving as the Federal Reserve’s unofficial advance team when it comes to paving the way for the U.S. central bank’s latest pronouncements.
This morning, he told Fox Business morning anchor/personality Maria Bartiromo (formerly of CNBC) that it looked to him “like the Fed won’t do it.” He was referring, of course, to 2015’s ongoing Hamlet-Godot-style Fed whodunit: will they raise interest rates or not, and if so, when will they do it? Hilsenrath is apparently betting on another non-answer today, although he could be covering for his Federal Reserve pals. But we’re not sure this gang is that creative.
The Fed wants to raise interest rates… badly. It matters little to them, it seems, just how much rates would go up, in what increments, how often, etc. Just the simple act of a tiny rate hike after nine years of no rate increases would be enough to signal their future intentions. But as the Wicked Witch of the West once opined, “It’s not what to do. It’s how to do it. These things must be done delicately.”
The financial punditocracy opinion machine currently runs the gamut today from “the Fed will raise today; to Hilsenrath’s more cautious observation; to the Maven’s idea that maybe they’ll raise rates just 1/8th of 1 percent in December; to “they’ll never be able to do it.” The Fed had really intended to begin rate-raising action this September. But the current China mess, and now the continuing refugee mess in both Europe and the U.S., plus IMF warnings, have given the central bankers pause.
Meanwhile, we will get at least another half-day of market meandering. Wednesday, the market did just that for most of the day before closing out trading activity with a burst of irrational exuberance, as former Fed chair Greenspan once famously observed. Who knows what stocks, bonds and the underlying averages will do this afternoon once the Fed releases its intentions? Or its obfuscations and qualifications?
Major averages are slightly up as of this writing (noon EDT) on typically light, pre-Fed volume. Who knows what will happen after the announcement? But, as we noted in yesterday’s column, the rich bankers, traders, HFTs and other elites will already know the answer in advance, and will start tipping their collective hands roughly 15 minutes before the rest of us can read the Fed’s release. Unfair, of course. But so is much of life in the waning months of Obamanation.
Stay tuned for an update here later today.