Real And Artificial Threats Create Uncertainty In The Markets by Nathan McDonald, Sprott Money
Wall Street is experiencing a rough day. Facing serious headwinds on two fronts, it is experiencing a sharp drop in prices as investors continue to be finicky and nervous.
Uncertainty is the name of the game, and you better believe that there is uncertainty out there – real and clear uncertainty, not this bogus nonsense that the FED puts out.
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The threat to the markets that the FED is currently posing is complete and utter nonsense. It is MOPE. What we have is a voting member of the Boston FED, Eric Rosengren, who stated that the FED is facing significant risks if it waits to long to raise interest rates.
He believes that the FED needs to act and gradually start raising rates. ALTHOUGH, it is unlikely that the FED would raise rates too fast, he then went on to explain.
Meanwhile, on the other end of the aisle, we have another voting member of the FED, Governor Daniel Tarullo, stating that he would like to see inflation rise before rates are increased. ALTHOUGH, he is not ruling out the possibility of a rate hike later this year.
You see what they are doing here? This is a prime example of MOPE in action – you can’t make this nonsense up. One member of the FED comes out and sounds hawkish, yet ends dovish. Another member of the FED comes out and sounds dovish, but ends hawkish. What are they doing? Attempting to make our heads explode in confusion?
The latter point, although blunt, is in a roundabout way what they are aiming for. As I’ve stated before, the FED is just extending and pretending, trying to keep the markets in a state of limbo until the elections are completed. The last thing they are going to do is raise rates and tank the establishment’s candidate of choice, Hillary Clinton.
So, let’s chalk this threat up to nonsense and nothing but noise.
On the other hand, we have another slight, minor, tidbit of a problem affecting the markets: the news of North Korea testing a nuclear weapon. This is a real threat and problem, although likely not in the immediate term.
I personally have seen North Korea with my own eyes while on deployment in the military and can tell you that this is a downtrodden and economically depressed country. They are nowhere near capable of acting on the threats they make, although their radical and crazy leadership cannot be dismissed entirely from doing something completely irrational that would result in their own decimation.
Remember, that the world is a powder keg and real and artificial threats exist that could tank the markets at anytime. Ignore the noise, but filter through it nonetheless.
Those who act first will be the winners, while those that are ignorant and uninformed will undoubtedly be too late and thus the loser when this system comes crashing down.