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May 1, 2008


Rewriting the Recent Fed Statement

The Fed statements are too wordy and wishy-washy, so I’ve tightened things up.

Recent information indicates that Economic activity remains weak. Household and business spending are weak as are has been subdued and labor markets have softened further. Financial markets remain under considerable stress., and Tight credit conditions and the collapsing real estate market deepening housing contraction are likely to will weigh on economic growth over the next few quarters.

Although readings on core inflation have improved somewhat, Energy and other commodity prices have increased dramatically and some indicators of inflation expectations have risen in recent months. The Committee expects inflation to moderate in coming quarters, reflecting a projected leveling-out of energy and other commodity prices to stop rising in coming quarters and an easing of pressures on resource utilization. [We give no reason why we believe these prices will stop going up.] Still, uncertainty about the inflation outlook remains high. It will be necessary to We will continue to monitor inflation developments carefully.

The substantial easing of monetary policy to date, combined with ongoing measures to foster market liquidity, should help to promote moderate economic growth over time and to mitigate the risks to economic activity. The Committee will continue to monitor economic and financial developments and will act as needed to promote sustainable economic growth and price stability.

This last paragraph is troubling because the Fed’s massive campaign to “foster market liquidity” has also promoted massive price instability, i.e. inflation (see paragraph two). It’s impossible to make sense of something that’s self-contradictory.

This entry was posted on Thursday, May 1st, 2008 at 3:05 pm (utc+8) and is filed under Investing.

14 Responses to “Rewriting the Recent Fed Statement”

  1. ben said:
    May 1st, 2008 at 5:07 pm

    Are you a native English speaker?

  2. C. Maoxian said:
    May 1st, 2008 at 7:27 pm

    ben: Yeah, I’m a large hairy white man… born, raised, and edge-a-cated in the New-nited States of ‘merica.

  3. Gav said:
    May 1st, 2008 at 7:49 pm

    New-nited States of’merica….LOL..awesome.

  4. C. Maoxian said:
    May 1st, 2008 at 8:55 pm

    Gav: That’s something of an inside joke. There’s a televangelist named Jimmy Swaggart who says “New-nited States” — he does this on purpose to appeal to the “folks” … one of the best speakers and savviest media guys I’ve ever seen in action — an amazing performer, I’m a huge fan.

  5. Chav said:
    May 2nd, 2008 at 12:09 am

    Would that also be Amurca? LOL

  6. ben said:
    May 2nd, 2008 at 12:52 am

    Just curious, if you don’t mind, is your wife Chinese? And are you working as a consultant for some company in China?

  7. toddinfl said:
    May 2nd, 2008 at 4:20 am

    CM said re: Jimmy Swaggart

    “one of the best speakers and savviest media guys I’ve ever seen in action — an amazing performer …”

    Yeah, Swaggart can lay it on pretty damn thick. Preachers who can strut and swing their hips whilst on stage on Sunday morning preaching the scripture can get all the married women whipped into a frenzy.

    CM, you ever watched the movie with Steve Martin as an evangelist - “Leap of Faith” ?

  8. C. Maoxian said:
    May 2nd, 2008 at 7:00 am

    @Chav: Yes, that’s better than ‘merica. :)

    @ben: Yes and yes (sort of).

    @todd: He can also sing very well! Have not seen anything by Steve Martin since he took the arrow out of his head.

  9. Finn said:
    May 2nd, 2008 at 7:53 am

    Isn’t his (Swaggart) cousin Jerry Lee Lewis? My parents always thought that Swaggart was the only one willing to “tell it like it is” (in terms of hellfire and sin). Of course that was pre-”I have sinned”.

  10. C. Maoxian said:
    May 2nd, 2008 at 8:45 am

    Finn: Yes, he is (which explains his singing ability). My favorite bit of his was when he railed against “false preachers” who should “rip off their collars.” I can watch him for hours, mesmerized. :)

  11. v838mons said:
    May 3rd, 2008 at 2:39 am

    i like applying this correcting process to the euphemistic “Fed” itself, and Jim Willie CB’s moniker fits best: “The Ministry of Inflation”…

  12. C. Maoxian said:
    May 3rd, 2008 at 7:56 am

    v838: “Ministry of Inflation,” I like it. Who is Jim Willie? “Price stability” is their sacred responsibility — now being sacrificed to avert systemic collapse, or so my bailed-out buddies say.

  13. v838mons said:
    May 3rd, 2008 at 10:28 am

    Nothing “responsible” about The Ministry of Inflation so that takes care of the “stability thing” — one of the biggest and longest-running jokes ever as it is ALWAYS ALWAYS ALWAYS!!!!! being “sacrificed”, just one gigantic never-ending gambit (or so they think)… topic itself kinda elicits Minsky’s Financial Instability Hypothesis (”stability is destabilizing”)… of course nothing wrong with a little systemic collapse every now and then as long as long as it’s done in good taste and with (really) good intentions :>)… central planning politicians… robber barons/ Illuminati/Bilderberg… the good ol’ one-two punch combo — urgh…

    Willie is an excellent read and i highly recommend although i suspect i might get a tin foil hat comment or two if i haven’t already with my immediately prior comments :>)…

    Jim Willie CB
    Editor, Hat Trick Letter
    Proprietor, GoldenJackass.com

    FREE:
    Jim Willie, CB - Market WrapUp Archives for Financial Sense
    http://www.financialsense.com/Market/willie/main.html
    Financial Sense - Jim Will CB ~ Bio
    http://www.financialsense.com/Market/willie/bio.html

  14. C. Maoxian said:
    May 3rd, 2008 at 10:37 am

    v838: I’m a tinfoil hat man myself, but only after a couple of drinks. :-)

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