THE BANKER TAPER CIRCUS: The Greatest Show on Earth
For some odd reason, the market was shocked by the Fed announcement of “NO TAPER.” After listening to many analysts, only a few realized the Fed was not going to make a change in their policy. Jim Rickards was one of these analysts who spoke on Financial Sense this weekend.
When asked if Rickards thought the Fed had lost credibility, Rickards remarked by saying, “It’s not the Fed that lost credibility, it’s the analysts.” Rickards goes on to say that if these analysts had listened to their full statement earlier in June, they would have realized that the Fed would only taper if the “Economic Data” allowed them to do so.
Because the economic data has not improved (and continues to decline), why on earth would the Fed taper? This didn’t stop the armies of analysts and banks to promote their taper forecasts. I would imagine the bullion banks “Clearly” understood that the Fed wasn’t going to change its policy, which is why we saw a huge move up in the precious metals before the announcement — insider bullion bank trading at its finest.