A Bear Market Is About to Show the Fed Who’s Boss

They don’t ring a bell at the top, as the old saying goes. In retrospect, we can see that it very likely occurred last summer with a series of three record price peaks, roughly equal, that we were too bored in the dog days of August to care about. Bored we no longer are, however. The election is going to change things very dramatically for all Americans regardless of who wins. About the only thing we can be certain of is that the Fed will NOT raise interest rates. This is notwithstanding the pathetic, hawkish spin that has once again emerged from those bastions of Fed-worshiping ignorance: The Wall Street Journal, The New York Times and The Washington Post. Fed policy has become increasingly irrelevant over the last year or so and will become still moreso as a full-blown bear market in stocks gains momentum. The good news is that whatever flimsy rationale has existed for central bank meddling is about to be banished from enlightened discussion for a hundred years. We are not likely to be so fortunate in hard times with respect to the fate of Keynesian quackery, but a discredited Fed will be a big step in the right direction.