The Fed May Lose Control

Today, I think something quite important has happened:  Markets slipped ever so slightly out of the Fed’s grasp.  Is this a preview of things to come?

I have been talking to some of my top colleagues in bond, currency and and equity markets today, and there is one word that has most immediately come to my mind:  Disarray.

And I am not primarily talking about the price action, which has been quite volatile:  The 10Y Treasury yield up over 7% to 2.36%, high yield bonds down by almost 1.5%, emerging markets bonds getting clobbered down more than 2.0%, from the highs, and the S&P 500 down by 23 points.  I am talking about the fact that there is no consensus whatever regarding what the FOMC and its Chairman actually said or meant by what they said.  And most everybody seems to be scratching their heads as to why the markets have reacted as they have.

In this exclusive report to my subscribers, I am going to offer some insight about what is going on.

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Bill Gross’s Misguided Diagnosis Of America’s Economic Problems

Fortunately for Mr. Gross, and all of us that provide commentary on economic and financial affairs, people cannot be prosecuted for malpractice for merely expressing opinions. However, I do believe that ideas have consequences. And, for this reason, I am concerned that the faulty analysis propounded by Mr. Gross in the aforementioned essay (and subsequent follow-up media appearances) could gain currency amongst economic and financial analysts and/or the public at large.

Continue reading this article at Seeking Alpha.

Bill Gross’s Dreadful Analysis Of The U.S. Economy’s “Wounded Heart”

Basketball living-legend Lebron James shot an air-ball during last Thursday night’s Game 1 of the NBA Championships; he also threw up a brick at a key moment in Game 1 of the series against the Chicago Bulls that didn’t even touch rim. That ugly-looking heave by “King James” reminded me of a recently published essay entitled “Wounded Heart,” penned by “The Bond King” Bill Gross, a living legend in the investment field. King James’ embarrassing off-balance, double-clutch, fade-away floater reminded me of The Bond King’s essay because the latter struck me as containing some of most fundamentally unsound economic and financial analysis I have ever seen published by a respected analyst – much less from an investment hall of famer.

Continue reading this article at Seeking Alpha.