Coming in at the end of Friday, we have a little flashback to our article about St. Louis Fed President James Bullard and his penchant for constantly changing his views on the proper course for monetary policy. At the time we published the article, Bullard was in his hawkish phase, but he subsequently went back to being a dove, stated that the US economy only needed one rate hike through 2018. Now he is back to aligning himself with the hawks, stating that another rate hike next year would be appropriate, as would beginning to allow the Fed’s balance sheet to shrink. Perhaps that is why the FOMC can’t seem to make up its mind on what it wants to do, its members keep changing their opinions on what’s happening and what they should (or shouldn’t) do about it. As we wrote back in March:
At the end of the day, decisions on monetary policy are ultimately a judgement call, made with the same level of thought that might be given to where to hold the office Christmas party. The value of the dollar, the standard of living of the American people, and the health and well-being of money and banking in the United States are placed in the hands of a tiny group of people. It is a recipe for failure and disaster. Far better to leave everything to the workings of the market, where the choices of millions work together for mutual betterment and to outweigh the efforts of would-be tyrants, than to trust in the capricious and flighty fancies of our modern-day mandarins.
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