Yellen’s speech today in Jackson Hole shows a Fed that appears desperate to hike rates. Why?
Here are the last four quarters of GDP.
- 3rd Quarter 2015: 2.0%
- 4th Quarter 2015: 0.9%
- 1st Quarter 2016: 0.8%
- 2nd Quarter 2016: 1.1%
It’s highly unlikely the Fed believes 1% is the new normal for robust growth. So why is it so desperate to hike rates?
Top Reason Fed Wants To Hike
1. Asset bubble worry
2. Strong jobs inflation
3. So it can cut later
4. Fed clueless— Mike “Mish” Shedlock (@MishGEA) August 25, 2016
No Confidence
Despite wanting the hike, a Yellen slide from the Jackson Hole symposium shows the Fed has little confidence that it will hike.
For details please see Yellen Discusses “Tools”: She’s 70% Confident That Rates will Be between 0 and 4.5% in 2018.
Mike “Mish” Shedlock
