All you need to know about JackHole is that Janet will talk up her book the same way she has done since taking office. She will try to figure out a way to tell investors that a rate hike is coming in December without scaring the shit out of them. She wants us to stop being so complacent. Investors will be hanging on every word.
What I don’t understand is how we continuously believe every word that spews from every central banker’s mouth. When the market goes down we blame it on rate hike talks. Yet we’ve hiked 1 time in the past 9 years and the dot plot looks like shit.
As you can see from the chart below, the market hasn’t moved in a month, in fact it has moved less in the past month than any other period in the past 20 years. Thankfully I’ve gotten in many rounds of golf without coming back to an Armageddon. Last year was quite different. Only a few days before the Jackson Hole Summit of 2015, the market quickly took a +10% haircut in 3 days.
If we are lucky, maybe we will see a guest appearance from the bearded clam.
Yellen’s speech begins at 10am ET on Friday. Bring popcorn and EpiPens. We deserve 2200.
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