Many years ago, when it was still unclear who would replace then outgoing Fed chair Ben Bernanke, Zero Hedge endorsed John Taylor for the role of Fed chair: a futile endorsement as it had no chance of ever coming true due to Taylor's famous and long-running feud with the Fed over what the true Fed Funds rate should be, and the various pro forma adjustments the Fed imposed upon Taylor's own "Taylor Rule."
The Fed is baffled as to why inflation remains so low.
It’s a clever move, given that the reason inflation is believed to be “low” is because the Fed has been purposefully understating inflation for years.
Perhaps the biggest fraud ever committed in financial history concerns the understating of inflation in the Unites States post-1971.
It was exactly one week ago when just as Bloomberg reported that Yellen was most likely out of consideration as next Fed chair, and as the WSJ reported that Trump was meeting with Kevin Warsh, that Politico reported, for the first time, that discussions with people close to the Fed Chair selection process "confirmed Kevin Warsh and Jerome Powell as the current front-runners with Treasury Secretary Steven Mnuchin said to be favoring Powell. That’s something of a head scratcher to outside observers of the process who did not have Powell on short-lists before the process began.
Looking at today's scheduled release of Minutes from the September FOMC meeting (which at least according to one trader will be the "start of the market changeover process"), RanSquawk reminds us that the Federal Open Market Committee stood pat at the meeting, as expected. The Committee also announced that it would begin to shrink the size of its balance sheet in October, as expected, with the process falling in line with a previously disclosed detailed plan.
Authored by James Rickards via The Daily Reckoning,
Janet Yellen’s mantra is, “It’s transitory!”
That’s Yellen’s typical response to a long litany of data that shows the U.S. is in the grip of a powerful disinflationary trend that may lead to outright deflation - a central banker’s worst nightmare.