The divergence between the 'hope' melt-up in stock markets and the 'nope' collapse of the US Treasury yield curve has never been so wide... and has never engendered so many excuses by commission-takers and asset-gatherers for why the latter is wrong and the former correct.
The following article by David Haggith was published on The Great Recession Blog:
Steve Liesman's Saturday night report that NY Fed president, and former Goldman chief economist is retiring, was spot on and moments ago it was confirmed by the Federal Reserve Bank of New York which today announced that "William C. Dudley, president and chief executive officer, intends to retire from his position in mid-2018 to ensure that a successor is in place well before the end of his term. Mr. Dudley’s term ends in January of 2019 when he reaches the 10 year policy-limit in the role."
The Federal Reserve's "smooth transition" from Janet Yellen to Jay Powell is set for a major speedbump.
Just two short days after Donald Trump confirmed what weekly trial balloons had reported for weeks, namely that Janet Yellen is being replaced with most "dovish" alternative possible in the face of former Carlyle partner and 5 year Fed governor Jerome Powell, the person who according to some is even more instrumental to Fed policy than Janet Yellen, NY Fed president Bill Dudley is reportedly leaving.
It is said that the markets will test a new Fed Chair early on and judging by the fact that financial conditions just tumbled to their 'easiest' in 24 years - despite four rate hikes - Jerome Powell will have his work cut out persuading the market that he is serious (before this bubble bursts).
The 'market' behaved as expected after the initial rate hike in Dec 2015 - financial conditions 'tightened' as The Fed 'tightened'. However, since then The Fed has entirely lost control...