Bullard needs psychiatric meds

After all, in the short space of one week he gave opposing outlooks.

On October 9:

In a speech that offered an upbeat assessment of the economy, Federal Reserve Bank of St. Louis President James Bullard said Thursday he is worried about what he sees as disconnect between what central bankers think will happen with monetary policy, and the view held by many in the market.

“When there is a mismatch between what the central bank is thinking and the market is thinking, that sometimes doesn’t end well, because there can be a surprise later on,” Mr. Bullard told reporters.

Right now, “the markets are making a mistake” and expect the Fed to maintain its ultra-easy policy stance longer than Fed officials themselves currently expect, Mr. Bullard said. When it comes to these expectations, “I would prefer that those be better aligned than they are.”

On October 16:

The Federal Reserve may want to extend its bond-buying program beyond October to keep its policy options open given falling U.S. inflation expectations, Federal Reserve Bank of St. Louis President James Bullard said Thursday.

It would keep the program alive,” and the Fed’s options “open as to what we want to do going forward,” Mr. Bullard said during an interview on Bloomberg TV.

Once again, the markets beat individual fantasies!

4 thoughts on “Bullard needs psychiatric meds

  1. So wishy-washy. Flip! Flop!

    I don’t think Bullard grasps that his suggestions about the future have a large and immediate impact on the markets (and therefore the economy).

    Which Fed people actually do grasp the critical importance of expectations (forward guidance) as opposed to concrete steppes? Evans? Bernanke? Yellen? Kocherlakota? Any of them?

  2. Look at the sudden surge in the S&P 500!!!!

    Could Bullard’s flip-flop really be the reason for it? Or is something else going on?

    • Travis. These guys are useless. Like a gorilla in a china shop. They have no idea about the power of their words. Plosser “speaks for the shorts”, Bullard for the “high frequency trader”!

  3. Very interesting stuff given that inflation expectations had a pronounced fall already when he gave his speech. But I guess facts and real figures don’t mean much. when he’s making his power play, telling everyone what they’ll get regardless of the target! He and Plosser are like Cheech and Chong – We don’t need no stinkin’ target!

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