This is taper light, at best. But its not even that. Because the Fed was so worried about the effect that would have on the market simply by announcing a decision to taper in the future that the Fed decided to sugarcoat that bad tasting medicine. How did they do it? The Fed changed its language with respect to its commitment to keep interest rates at zero. They have been at zero for years and the Fed has said, as long as unemployment is above 6.50%, interest rates will stay at zero. Now,the Fed has changed that language, it has rewritten it. It now reads, the Fed is going to leave interest rates at zero well past the point in time where the unemployment rate goes below 6.50 percent. So they haven`t just moved the goal posts, they have destroyed the goal posts.
Peter Schiff is an American businessman, investment broker and financial commentator. Schiff is the CEO and chief global strategist of Euro Pacific Capital Inc.
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