by James Rickards
Daily Reckoning
Does the Fed even matter that much to the real economy and investor portfolios?
That’s an important question that doesn’t get nearly enough scrutiny. It’s possible that neither the Fed nor the reporters who cover the Fed want to ask hard questions about what the Fed really does.
Could it be the case that the emperor has no clothes?
Financial journalists often refer to a Goldilocks economy (“not too hot, not too cold, just right!”) as a tribute to the Fed’s finesse in handling rates. It’s also called the “soft landing” scenario because the Fed supposedly tamed inflation without causing a recession.
These narratives have no factual foundations; they’re just stories designed to get you to buy stocks and pump up stock prices.