“Markets” Weren’t Rattled Yesterday. It Was Just the Usual Few Morons Overreading the Tea Leaves.


James Pethokoukis summarizes the conventional wisdom about Janet Yellen’s first run-in with the media yesterday:

A “market rattling” press-conference performance from Janet Yellen, and Wall Street is suddenly thick with Ben Bernanke nostalgia. “The more experienced Bernanke knew to avoid clarifying deliberately vague statement language,” wrote JPMorgan economist Michael Feroli in a research note. Feroli was referencing Yellen’s squishy, off-the-cuff remark that interest rate hikes might start earlier rather than later next year, or “about six months” after the end of the central bank’s bond buying program. A “rookie gaffe” is how economist Paul Edelstein of IHS Global Insight put it.

You can find about a million stories like this. But as much as I like to mock the panicky nature of Wall Street traders, I think everyone needs to take a deep breath here. As you can see in the chart above, the S&P 500 lost a whopping 1 percent of its value for a grand total of about 24 hours. By 1 pm today it was right back where it had been for the two days prior to the Fed meeting.

The numbers tell the tale: It’s pretty obvious that Yellen, in fact, had only a tiny, transient effect on the market—exactly the same kind of effect Bernanke used to have whenever analysts trained their Wittgensteinian microscopes on, say, the precise linguistic difference between “extended” and “protracted.” In the end, a few morons lost money by overreacting to Yellen’s comments, and that’s about it. This is not exactly a rare event in global high finance.

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SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

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