Loading ...FOMC Statement – Backing Off On the Rate Increases, Lowering Forecasts
The Fed recognized that growth is slow, and that inflation remains subdued.
I include a chart of the real median household income to demonstrate why the recovery is so wobbly. Demand and investment are weak because most people have less money to spend. Wow, what a surprise.
The pampered princes of the establishment keep pointing to the ‘great jobs growth’ while ignoring the low pay, part time nature of those jobs, and the slumping Labor Participation Rate.
The ‘trickle down theory’ does little more than enrich the already rich, and stretch the fabric of society to the point of instability.
And I believe that this is purposeful, because they are caught in a credibility trap. They cannot address the root problems because it risks their place in the ‘system’ that they have crafted that rewards their wealthy and powerful patrons excessively at the expense of most others.
The Fed attributes this uncertainty to ‘global economic and financial developments continue to pose risks.’ And they have not only scaled back their inflation expectations, they have also scaled back forecasted GDP growth, which I think is still a bit optimistic.
If one looks at their ‘dot plot’ they are indicating a less frequent raising of rates this year, perhaps only two occasions rather than three.
I have included the Fed’s data sheet below the text that shows the difference between what they had forecasted in December and what they have changed that to now.
The US dollar dropped and gold took off higher like a scalded cat. Stocks remain mixed.
Janet Yellen will be giving a press conference shortly.
http://jessescrossroadscafe.blogspot.com/2016/03/fomc-statement.html