Waiting for the Fed

Is the Fed doing anything?

Yesterday the Fed met, talked about the economy, had lunch, and issued an almost unchanged policy statement. What they have been doing, they will keep on doing. This is news?

The Federal Reserve manages the money supply. They set short-term interest rates. They monitor the capital markets and help regulate the banking system. They’re a creation of Congress to help guide a $16 trillion economy through fair weather and foul. But sometimes their policies appear to be on auto-pilot, for all the pomp of the Governors and regional Presidents arriving amidst super-secret proceedings.

It’s like Samuel Beckett’s play, Waiting For Godot. In this drama two tramps stand around waiting for Mr. Godot to arrive. What they will do when he gets there is unclear. As they wait they discuss religion, philosophy, their health, the weather, economics—all sorts of issues. Other people come and go. But Godot never shows up. In fact, a second act takes place in which many of the conversations are repeated, but the opposite character voices them. And again, Godot fails to arrive.

The play has been described as a drama where the audience remains rapt, and yet nothing happens, twice. Its message is that life goes on, whether we can give it any meaning or not. The difference between Godot and the Fed is that with the central bank, nothing seems to happen eight times.

Douglas R. Tengdin, CFA

Chief Investment Officer

By | 2014-05-01T09:55:38+00:00 May 1st, 2014|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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