🤑 Fed’s Folly: Schmid’s Stand Against Rate Cuts! 🤑

by

Markets

What to know, dear reader:

  • Ah, the Fed! Those masters of monetary mirth did cut rates, yet lo! Kansas City’s Jeff Schmid, a lone voice in the wilderness, cried, “Hold!” 🛑
  • Inflation, that pesky imp, remains too high, quoth Schmid in his essay of dissent. A plague upon our purses! 💸
  • Bitcoin, that fickle friend, slipped like a courtier on a banana peel as Schmid’s words hit the airwaves. 🍌

Imagine, if you will, a central bank so cunning as to cut rates while still brandishing a hawkish talon! The U.S. Federal Reserve, in all its glory, hath achieved this feat this very week. Bravo! 👏

On Wednesday, the noble Fed Chairman Jerome Powell, in his post-meeting soliloquy, unleashed a broadside upon the markets, declaring a December rate cut as likely as a unicorn sighting. The reaction? Swift as a pickpocket in Paris! Crypto and stocks tumbled like courtiers fleeing a plague. 🦄

And let us not forget the vote! A chummy lot, these FOMC members, usually voting in unison like a well-rehearsed choir. Yet, this Wednesday, a dissent arose! Jeff Schmid, the Kansas City Fed President, stood firm, voting to hold policy steady. (And let us not overlook Stephen Miran, Trump’s appointee, who voted for a 50 basis point cut-a surprise? Hardly, for he doth protest too much.) 🎭

Inflation, that stubborn wretch

In his essay, Schmid, with a quill dipped in sarcasm, questioned the Fed’s eagerness to ease conditions. Stocks at all-time highs, corporate bond spreads narrower than a courtier’s smile, and high-yield bonds flowing like wine at a royal feast-why ease now? 🍷

“Inflation,” he reminded, “hath remained above our 2% target for years, and doth show no sign of retreat. Small comfort, indeed, that expectations have not risen!” 😒

And what of the labor market, you ask? Schmid waves it away like a fly at a picnic, blaming “structural changes in technology and demographics.” Ah, the old scapegoat! 🐜

Markets, those fickle creatures

Amidst a modest bounce from yesterday’s tantrum, markets on Friday pulled back like a courtier bowing to the king, with bitcoin slipping under $110,000 and Nasdaq futures rising a mere 1.3%-a far cry from the earlier 1.7%. 🧑‍🎤

Rate traders, those ever-anxious souls, now price in a mere 66% chance of a December rate cut, down from 73% yesterday and a whopping 95% before Powell and Schmid’s Wednesday surprise. Oh, the drama! 🎭

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2025-10-31 17:21