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The Flat-Line Fed

October 9, 2015

Normally longevity is good thing. Everyone wants to live a long life, right? Of course.

Another meeting at the Fed yields more of the same – nothing. Despite economic growth, the Fed is sticking to its stimulus program of low rates because of international economic uncertainty (i.e., China’s slowing growth) and falling commodities prices.


At least we get new reasons (excuses?) for the inaction, right? However, the bottom line remains that the federal funds rate is the same it’s been since 2008.














In essence, the Fed is acknowledging that its economic growth policy approach is a failure. To me, citing international concerns is a sign of uncertainty, as if there are no tools left in the toolbox.


Even a modest bump in the rate would’ve helped. It would’ve signaled that the Fed believes the growth we’re experiencing is sustainable. It also would’ve gone some way towards fixing the ills caused by cheap credit. Instead, the rate stays stagnant. All this nothing continues to make us obsess over the Fed and when (not if) rates will go up.


The institution is becoming the epicenter of inconclusiveness and eroding its credibility. How long will the stock market continue to embrace this?  The economy is changed, it’s time for the Fed to raise rates and let it normalize.

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This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. Please consult with a professional specializing in these areas regarding the applicability of this information to your situation.

Andrew Wood, Dan Simon and Alison Slezak are Investment Advisor Representatives. Advisory services are offered through CoreCap Advisors, LLC., a Registered Investment Advisor. CoreCap Advisors, LLC and Daniel A. White & Associates, LLC are separate & unaffiliated entities. 

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