Federal Reserve Holds Two Emergency Meetings In Three Days
I cannot recall emergency Fed meetings ever taking place this close together in the past; something odd may be afoot. Theories on the web abound, including some who believe the Fed is preparing to announce more stimulus measures. I highly doubt this scenario for a number of reasons. The Fed has spent the better part of the past six months ignoring ALL negative data, and there has been a lot of negative data. To reintroduce stimulus at this point simply does not fit their ongoing narrative that a “recovery” is in full swing. Also, such a move without preparing the public in advance would be an outright admission that they have been lying for quite some time. Thus, a collapse of markets would immediately erupt.
The far more likely scenario is that the Fed is preparing for yet another rate hike, either this month, or in June. Still, such a hike would undoubtedly surprise the markets and crush their short term hopes and dreams, but not to the extent that a total admission of policy failure by the fed would induce.
The last time such an emergency meeting took place was in late November of last year just before the Fed raised rates for the first time, resulting in a loss of thousands of points on the Dow. This might explain the constant jawboning by the banks to drive up equity prices the past six weeks – it may be preparation for another rate hike and another dive in stocks. Also, keep in mind the surprise meeting between Yellen and Obama, not to mention the G20 meeting, the IMF meeting, the World Bank meeting, and the Doha meeting, all taking place the next week. The elites seem to be preparing for an event. Watch the news feeds carefully…
Brandon Smith, Associate Editor
Watch out for FED’s emergency meeting tonight, which was suddenly and unexpected called to last week and will take place today in Washington at 11:30 am local time or 3:30 pm GMT. FOMC officials are likely to discuss on FED’s discount rates.
FED’s discount window is crucial source of funding for financial institutions, especially in time of stress. Current interest rates are as follows –
Primary credit – 1%
Secondary credit – 1.5%
Seasonal Credit – 0.45%
Last time, when FOMC hiked rates in December, these rates were adjusted 25 basis points higher.
Participants can choose to vote for hike today, however that is non-binding, meaning it will be up to the policymakers to decide on rates. But if most members votes for a rise today, then April meeting is very much alive. Details of today’s meeting will be published later on but not before April rate decision.
Last time FED held such a meeting was back in November 21st, after which it raised rates within a month.
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