Business

The Wall Street Journal won the award for the greatest "Shock And Awe" financial headline of the day when it published a story earlier entitled "Warren Buffett Says the Dow Is Going Over One Million."  The 'Oracle of Omaha' apparently made the 'bold' prediction at the 100-year anniversary celebration of Forbes magazine in which he also said that "being short America will continue to be a loser’s game."  Here are the highlights from WSJ:

Authored by 720Global's Michael Lebowitz, via RealInvestmentAdvice.com,

“There is no other agency of government which can overrule actions that we take.” 

– Alan Greenspan

In what has been the most stunning admission by Janet Yellen so far during her press conference, the Fed Chair said that "we don't fully understand inflation" and added that the "shortfall of inflation this year is more of a mystery."

With all due respect, it's not. But since the Fed is often confused, we would like to do the central bank a favor and "explain" inflation, or the lack thereof as the Fed laments, with just one chart.

To simplify enough that everyone on the FOMC will understand, here it is:

Is 'the committee to save the world' about to 'unsave the world'? Not according to The Fed who see their balance sheet unwind as boring a "watching paint dry."

Of course, aside from the fact that The Fed has been unable to forecast its way out of a paper bag for decades, more than a few market participants believe otherwise, including BofA who recently warned..."the paint may be drying but the wall is about to crumble."

With the Fed set to unveil its first balance sheet reduction in modern history - an event that is largely priced in - what traders are far more interested in, is what will happen to the Fed's "dots", where consensus anticipates no move for the 2017 dot, while the 2018 and 2019 dots could shift lower as the FOMC language turns slightly more dovish.

How could this dot "migration" take place?

First, as Adnan Chian observes, at least 4 Fed members need to move their 2017 dots lower to shift the median from 1 more hike in 2017 to no more hikes, i.e. December is "dead."