by Rick Ackerman
The pundits trotted out the usual lame explanations for the stock market’s steep drop on Friday, with “anxiety about Fed tightening” topping the list. The irony is that the 400-point plunge in the Dow Industrials will have made the chances of a rate hike even more remote than they were before the selloff. Even then, any real tightening was about as likely as a Martian invasion, a point we’ve been hammering since the last rate hike more than nine years ago. Yes, we were wrong for one brief instant when the Fed raised the fed funds rate by a token 25 basis points. But anyone who argues that that constituted “tightening” is either an economist, a Wall Street analyst or some hack reporter trying to gin up what passes for news these days on the business pages. Will it take a further thousand-point decline in the Dow for these dimwits to stop obsessing about a rate hike that was never going to happen in the first place? We may be about to find out. In any event, the one explanation you will not hear on CNBC or Bloomberg for Friday’s avalanche — the correct one — is that it simply happened because it was time for it to happen. The stock market doesn’t need news to make it go up and down.