Famous last words

“We have been watching closely the recent volatility in global
financial markets. Our sense is that at this stage these developments do
not pose a substantial risk to the U.S. economic outlook.”

– Jane Yellen, Fed Head

She even sounds like Bernanke back in 2008. And, just in case it wasn’t completely obvious, we have the reassurance that the desperate money pumping will not end until the entire system collapses too.

“The Committee has emphasized that a highly accommodative
policy will remain appropriate for a considerable time after asset
purchases end.”

I’ll bet it has. After all, we’re only looking at a $29 trillion credit demand gap. The thing is, even from a Keynesian perspective, one should be able to discern that we are in a giant economic contraction. Here is the old Econ 101 question: highly accommodative monetary policy is prescribed when the economy is a) growing, or b) contracting?