by Mish

2nd quarter GDP rose at 4.0% annualized, 3rd quarter rose at 5.0% annualized, and 4th quarter rose at 2.3% annualized.

Instead the Fed was worried about growth, when growth was fine. Where the heck were the dissents for hikes in 2014?

Last Three Quarters

  • 2nd Quarter 2016: 1.4%
  • 1st Quarter 2016 : 0.8%
  • 4th Quarter 2015: 0.9%

At the last FOMC meeting there were three dissents in favor of hikes.


Curiously, the Fed is no longer worried about growth. Instead, some members of the Fed are increasingly worrying over bubbles they have blown.

The Fed does not call them bubbles. They mask concerns by citing leverage as noted in Rate Hike Odds Rise Again: Fed Concerned About Corporate Leverage.

Too Late to Worry

By the time the Fed starts worrying about something, it’s far too late. The damage has already been done.

The Fed is not only late to the rate hike party, it blew numerous bubbles in the meantime.

Leverage Worries or Not …

Mike “Mish” Shedlock

Rate Hike Odds Rise Again: Fed Concerned About Corporate Leverage

Despite anemic GDP forecasts for third and fourth quarter, the Fed appears to have convinced the market that it will finally hike rates in December.

St. Louis Fed President Criticizes Rate Hike Expectations as Too Aggressive: Is He Correct?

Citing weak inflation expectations and weak economic reports, St. Louis Fed’s Bullard says expected rate hikes ‘aggressive’.

Rate Hike Cycles vs. the US Dollar: Rate Hikes Bad for Gold?

Here are two different looks at Fed rate hikes since Volcker. The charts are the same, but one presentation is a lot funnier than the other.

Rate Hike Odds 99 Percent for June: Then What? Fed Hike Cycle Over?

CME Fedwatch places a 99.6% possibility of a quarter point rate hike on June 14.

Five Reasons Fed Won’t Hike Even Twice in 2017

On December 14, right before the FOMC decision I took a snapshot of rate hike odds and posted them in Fed Hikes Today, Then What?

Pop Quiz: Should the Fed Have Hiked?

Here is the question of the day: Should the Fed have hiked on Wednesday?

Kansas City Fed says Rate Hikes “Necessary” as Weakness is “Transient”: June Rate Hike Odds Sink

Esther George, president and chief executive officer of the Kansas City Fed says Continuing With Rate Rises Is ‘Necessary’.

Consumer Spending Flat, PCE Inflation Weakest Showing In 16 Years, Rate Hike Odds Rising

The market is increasingly convinced the Fed will hike in June, even as the economic data sinks.

Too Late To Matter: Fed-Sponsored Economic Bust Coming No Matter What

All eyes and ears will be on the Fed today. But it doesn't matter what the Fed does or says.