To see how misleading the Fed’s interest rate hike projections have been in recent years, have a look at the chart below.
As you can see, projected interest rate hikes compared to actual rate hikes differ drastically.
I don’t know what’s worse… the Fed’s forward guidance track record or the people who actually trade on that guidance.
Yet there I was on Wednesday night watching a Harvard-educated “analyst” on Fox News telling “Special Report” anchor Brett Baier that the most important thing investors needed to be concerned with was the Fed’s plan to raise rates three times in 2017.
That’s utterly worthless advice.
Hold on. I am being kind.
That’s moronic advice.
The data clearly shows that the Fed doesn’t do what is says it’s going to do.
Look, does anyone not sniffing bath salts believe the Fed is going to continue raising rates on schedule if the U.S. stock market craters… or if Europe implodes… or if China’s credit bubble bursts?
There are countless Fed “variables” it will use to justify altering its plan… as it has in years past.
The bottom line is the only thing of value we learned from the Fed this week is they raised rates on Wednesday.
What it does in 2017 has no relation to its stated projections, just as was the case in 2013, 2014, 2015 and 2016.
Worrying about the implications of the Fed’s rate hike timetable is a time-sucking charade designed to bleed you dry. The Fed and the media are never on your side.
Focus on the only truth you know, and that is the price action of all markets.
Let the price action dictate your actions, your buys and sells. That’s what winners do.
Please send me your comments to email@example.com. Let me know what you think of today’s issue.
Editor, Covel Uncensored