After her disastrous debut just two weeks ago, in which Janet Yellen managed to crush market spirits to the tune of 200 points in 1 trading hour, today, we got a “better” version of herself that markets tend to love. Just as predicted on this blog. In fact, don’t expect to hear anything but “We will print and do whatever is necessary to keep this liquidity party going” moving forward.
This, of course, relays into everything we have been saying about the economy, the unemployment and the future of interest rates (yield curve). Again, with the advent of the bear market of 2014-2017, the US Economy will find itself in a severe recession by the end of 2014. In such an environment, the FED will not be tightening anything. Counter to today’s popular believe they will be looking to re-inflate, infuse credit or cut in any way possible. The result? Much lower equity prices, compressed (perhaps inverted) yield curve, much higher unemployment rate and surging gold prices.
Basically, exactly the opposite of what most of today’s market participants believe. If you would like to know exactly when the bear market of 2014-2017 will start (to the day), while setting the whole mess mentioned above in motion, please Click Here.
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Yellen To Markets: Don’t Worry, I Will Print My Ass Off Google
Reuters Writes: Yellen strongly defends easy Fed policies, cites labor slack
CHICAGO (Reuters) – Federal Reserve Chair Janet Yellen said on Monday the U.S. central bank’s “extraordinary” commitment to boosting the economy, especially the still struggling labor market, will be needed for some time to come.
Yellen, in her first public speech since becoming Fed chair two months ago, strongly defended the Fed’s policies of low interest rates and continued bond-buying, saying there remains “considerable” slack in the economy and job market.
“I think this extraordinary commitment is still needed and will be for some time, and I believe that view is widely shared by my fellow policy-makers at the Fed,” Yellen said at the 2014 National Interagency Community Reinvestment Conference