Why The Convoluted Message From Yellen?

By: Gary Tanashian of Biiwii.com

Why the tough talk out of one side of her mouth and ‘other policy tools’ language out of the other (ref. Yellen Lays Out Tools… )?  Oh, I don’t know.  Maybe it has something to do with this…

The stock market has merrily followed money supply aggregates upward since 2009.  When money supply decelerates the market corrects.  When money supply ramps upward the market ramps upward.  Money supply has been rolling over since 2014, which was not coincidentally when the first tremors began for the stock market in its recently completed top (that wasn’t).  From SlopeCharts

s&p 500 and monetary base

But something is out of whack here.  Let’s dial in for a closer look.

s&p 500 and monetary base

When you see pictures like these that are not open to argument, and then you hear a powerful policy maker blabbing on about the strengthening economy and increased chances of a rate hike… and then you hear her slip in punch lines about ‘other policy tools’, and then you look at a chart like the above… you laugh in a ‘what else am I gonna do, cry about it?’ kind of way and you move forward.

Our policy makers are so transparent as to be funny, like Rosco the Clown…

clown car

…and scary, like Twisty the Clown.

Twisty the clown

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2 thoughts on “Why The Convoluted Message From Yellen?

  1. Market manipulation should be considered a crime, Central banks should be audited and, either we accept a planned economy according to the manifesto and banks become therefore public accounting centers, or we believe in the market role and its natural adjustments. After the demise of the Red booklet and the crash of Lin Biao plane on the Mongolian mountains, and the super exploit of Adam Smith theories in China, with the help of Friedman and Goldman Sachs capitalistic models and the Chicago boys, no one is more a manifest communist. So let's stop with this Central bankers hysteric liber fades and universal programs with other's people money trough official or unofficials servers.

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