The Federal Reserve turns 100 years old next month and looks set to celebrate its anniversary by delivering much more of the same. The looming confirmation of the “Mother of All Doves” Janet Yellen as the next Fed chief gives new meaning to the sentiment “Many happy returns,” as she sets the table for the endless banquet of Quantitative Easing to continue unabated.
0.2% of America’s biggest banks “now control more than 70% of the US bank assets.”
Are you worried yet? Hedgeye CEO Keith McCullough thinks you should be, and with Yellen testifying explicitly that “it ain’t over till it’s over – and I say it ain’t over,” McCullough believes the next crisis will be perpetuated by central planners. Recently on HedgeyeTV, Keith explained “Why the Fed is Failing.” The Fed’s “dual mandate” comprises price stability, and maximum employment. Hedgeye’s analysis of 50 years of bond market data shows price volatility in the bond market is at its widest point ever. Bond yields have shown corresponding volatility. Between the moment the market expected the Taper, and the realization that there was to be no Taper, bond yields experienced a swing of over 50%. This is the Fed’s version of “price stability” – in the “riskless asset,” no less.
