Kevin Warsh gave a speech at Jackson Hole. Markets reacted. Analysts wrote roundups about the speech. The analysts agreed Warsh sounded hawkish. Rate hike expectations climbed. September's FOMC meeting now carries more weight than your portfolio ever will.
The Treasury Department might disagree with the Fed's direction. Two government agencies operating at cross purposes. This never happens. Unprecedented. Someone alert the framers of the Constitution that separation of powers extends to monetary policy turf wars.
Retail traders read "hawkish stance" and immediately checked their Robinhood accounts. The accounts were down. They've been down since March. Warsh's speech didn't change that. But now they have someone to blame besides themselves.
Chart readers saw the news. They drew more lines on their screens. The lines pointed in different directions than yesterday's lines. Both sets of lines were equally useless. Technical support at meaningless. Resistance at who gives a f*ck.
The real story: a man spoke words into a microphone in Wyoming and people with finance degrees spent the next twelve hours explaining what the words meant to people who will lose money regardless of what the words meant. The Fed will do what it does. The Treasury will complain or not complain. Your stops will get hit either way.
Jackson Hole hosts central bankers every year. They give speeches. Analysts parse the speeches for hidden meaning. Markets move. Nothing fundamentally changes except the speed at which your account approaches zero.
Kevin Warsh's jawboning matters less than whether you bought at the top, but at least his speech gives you something to read while you average down into bankruptcy.
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