Friday’s Stock Sell-Off And The Fed’s Epic Fail

The U.S. Federal Reserve had four possible outcomes coming out of their latest FOMC meeting on Thursday. And it seems that the Fed may have ended up with the worst possible result.  Not only did the Fed potentially forgo their last reasonable opportunity to get off of the zero bound and squeeze in an interest rate increase for a future rainy economic day, but they may have also unwittingly sparked a new wave of downside stock market volatility that they have been so tediously careful to avoid over the last several years.  At least so far, the stock market has voted down the Fed’s latest decision. But now that the chatter and uncertainty about whether the Fed is going to raise interest rates is behind us at least for the next few weeks, what exactly can we reasonably expect from capital markets from here?

Please click on the link to read more of my article on Seeking Alpha.

The Worst-Case Scenario For The Fed

In case you haven’t heard, the U.S. Federal Reserve is meeting this week to decide whether to raise interest rates off of the zero bound for the first time since the financial crisis several years ago. Whether the Fed is or isn’t going to raise interest rates by one quarter of one percentage point on Wednesday has become one of the most overly tortured topics for discussion in recent memory. But while the market impact should be relatively muted – if investors aren’t prepared for the fact that the Fed may raise interest rates by now, they never will be – the stakes for the Fed itself are actually fairly high. The Fed desperately wants to raise interest rates, not because the economy is so strong but so that they can have a policy buffer in preparation for the next recession. But after too many years of waiting and coddling the markets, they are now very late in seeking to make such a move. And a misstep on Thursday could effectively close the window on their ability to raise rates going forward.

Please click on the link to read more of my article on Seeking Alpha.

Stocks: Perspectives On The Selloff

Global stock markets took a beating this week. U.S. stocks were part of the sharp decline including the benchmark S&P 500 Index, which unlike its global counterparts has been remarkably resilient up to this point. But given the pace of the sell off this past week and particularly over the last two trading days on Thursday and Friday, it’s reasonable to consider what we might expect from here.

Please click on the link to read more of my article on Seeking Alpha.


The China stock market has plunged into a tailspin. After rising an extraordinary +150% over the past year, the Shanghai Stock Exchange Composite Index has fallen by nearly just as notable -30% in the past three weeks. Despite the fact that China stocks are still +80% higher than they were just one short year ago, the recent sharp plunge has compelled Chinese policy makers to fire all of their stimulus and liquidity guns in a frantic attempt to stem the decline. How the recent market chaos in China ultimately plays out remains to be seen, but the response by Chinese policy makers in recent weeks raises and worthwhile question. What would U.S. Federal Reserve Chair Janet Yellen do if the S&P 500 Index was falling by -30% in similarly short order?

Please click on the link to read more of my post on Zero Hedge.

What To Do As Greece Crosses The Rubicon

For Greece, the clock is ticking precariously close to midnight. Perhaps the dial has even wound past the terminal hour. But as the new trading week begins, investor hopes of a clean resolution to the policy standoff between Greece and its European creditors have been all but dashed. Conditions could get potentially messy for investment markets in the coming days. As a result, it is worthwhile to have a well-considered strategy in place as events unfold in the coming days.

Please click on the link to read more of my article on Seeking Alpha.


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