Juggling Dynamite

After 2 years of talking about raising rates, the Fed couldn’t even ‘risk’ a .25 increase. The markets are selling off on the revelation that central banks are out of ideas and the global economy is sinking. The German Dax (Europe’s ‘power house’ economy) is off another 3% today, taking its decline since April to just under 20%.  Leading indicator?

Bill Fleckenstein, Fleckenstein Capital, analyzes what he believes is the problem with the Fed and provides his own market outlook. Here is a direct video link.

The US Fed has bluffed again, promising a rate hike and chickening out.  In doing so they admitted that the global economy is faltering and they believe that any move off zero rates will quicken its demise. If Ms Yellen were honest her statement would say:

” We messed up. We lowered rates for years to keep pushing debt-fueled consumption and we bankrupted the world. Then we bailed out the most reckless actors with public funds and have been funneling cash to those same criminals ever since. Now the system is so broken we are powerless to improve it. All we can do is talk brave and hope for miracles before people realize the magnitude of our errors and come after our heads.”

Despite its efforts for nearly two decades to raise doubts about the science of climate change, newly discovered company documents show that as early as 1977, Exxon research scientists warned company executives that carbon dioxide was increasing in the atmosphere and that the burning of fossil fuels was to blame.

The internal records are detailed in a new investigation published Wednesday by InsideClimate News, a Pulitzer Prize-winning news organization covering energy and the environment. Here is a direct video link.