Call it Taper Tantrum Two.
To get a better idea of how ludicrous this is, consider the following:
- The two hawks represent a sixth of the board. The hawks will need to more than triple their numbers to represent a majority.
- The two Fed members were speaking at a Cato Institute event called, “Rethinking Monetary Policy.” The event was not called, “Seven More Years of ZIRP,” “Zero Everlasting” or “Bring on QE4.” Why would anyone be surprised that they spoke in favor of a rate hike?
- One of the two, St. Louis Federal Reserve President James Bullard, is an alternate member of the FOMC and has long been advocating for a rate hike. This is the guy who caused the Dow to drop 100 points when he suggested in June 2014 that interest rates might be hiked in the first quarter of 2015. We tried to determine the role of an alternate member, but the Federal Reserve Board’s description is about as clear as a Fed policy statement. The page says there are 12 members of the FOMC, but lists 10, as well as four alternates. So how do they come up with 12? These are the people who are managing our economy.