- Today the FOMC minutes were released at 2:00 today and this is the last look inside the head of the FOMC members before September
- Now expectations are being pushed back to December
- Gold and silver prices were up today in spite of expected hawkish Fed comments
- We are at more than a one-month high in the gold price now above 1130 against a backdrop of extreme bearishness suggests we’ve seen the low in this cycle
- Silver was down yesterday and recovered dramatically today which suggests an upward trend
- There is no more upside in the “Fed is raising rates” trade
- The Fed may not raise rates at all, or say they might not raise rates again
- Is the Fed raising rates just so they can cut them? Raising rates will accelerate the recession
- Whether the Fed raises rates or does not raise them, this may be the end of the dollar rally and the end of the gold and silver decline
- The FOMC minutes do not indicate a plan for a rate hike in the future
- The Fed does not want to admit we’re not progressing in the direction the Fed wants; we’re moving the other way.
- Case in point: the Empire State Manufacturing Index came out on Monday
- Last month, in July the Index was 3.86% – a low number
- The consensus for August was a slight improvement to 4.75%
- We actually got -14.92%
- This is the lowest number since April of 2009 and the biggest miss since 2010
- The Fed is worried that there is not enough inflation
- There’s not enough growth and the job market is not there yet
- If the Fed is further away from their goal than they have been in this ridiculous monetary experiment of zero percent interest rates and quantitative easing
- Walmart earnings are down – blaming weak earnings on the strong dollar
- How much weaker will their earnings be with a weak dollar?
- Americans are spending more money on food – inflation that is not being measured
- The Stock Market is still selling off, because a rate hike is not priced in, as it is in the currency markets
- This would be the first Fed rate hike in a decelerating economy
- This is not a normal period, so don’t expect the stock market to behave normally
- Now, people are now starting to figure out that the Fed’s process is not so smooth
- The stock market will trend down until the Fed comes clean and admits that it cannot raise rates
- This is just a lag between QE3 AND QE4
- Anything that can go wrong, will go wrong and when it comes to this Fed and this monetary policy, Murphy is going to look like an optimist
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