On Vacation While Powell Announced...Nothing of Serious Interest

The usual "Fed Watch" this past week: It does get tiring, doesn't it? And when you're trying to take a few days vacation it's a real - to use current parlance - nothing burger. Why should we care?

Of course, there are reasons to care, unfortunately.

If you're a trader, you hang on these pearls of bogus wisdom since they can move markets - sometimes. And traders basically live for market movement. They try to anticipate up and bet accordingly; and vice-versa. The really good ones figure out how to make a quick buck even if markets wallow in their own mud. But still, Fed Watching seems a part of a trader's tool kit.

If you're buying a house and need a mortgage, you might Fed Watch. The typical 30-year mortgage looks at the rate for the 10-year treasury. And while the Fed doesn't set that rate, it does much of the time react to the Fed's decisions one way or the other. These days, the watching seems a bit of a waste of time, though, since the real estate market seems stuck in its own mud - a topic, perhaps, for another time.

Then there's the stock market. It's purported to like lower interest rates. But does it really? It seems to be true much of the time, doesn't it? On the other hand, there's a history that turns this on its head. When the economy is seen to be slowing, and the Fed sees this, and the Fed then lowers rates, to the dismay of those marching to the drum beat of the stock-market-likes-lower-interest-rates regime, the stock market swoons, sometimes dives, sometimes wallows in a Bear Market. 

Nonetheless, stock market honchos ride the Fed Watch wave.

The thing about vacation, though, is that it can wring the Fed Watch right out of you. Not that there was much Fed Watch left in me in recent years, but if you're in the business, you almost can't help but know when the Fed Chairman is going to get up out of his Fed Chair and approach the sacred podium reserved for these big events. 

Fed Watchers pull up their own chairs and hang on not only the pronouncement of the Fed Funds rate (up, down, unchanged), but allow the Big Balloon to expel its hot air into the room with words that will soon be parsed every which way resulting in reports about what the Fed Chairman really said.

Having resigned from the chair-sitters club a long time ago, there was still an interim period of checking in around announcement time to see whether rates would go up or down or nowhere. And then look at the various assets classes to see how they'd react. But, honestly, after a long stretch of this, there's been no conclusive pattern that ever emerged that could be used to better position our portfolios. In which case, what's the point?

So while still checking in at some point, and - admittedly - taking a peek at stocks, bonds, and gold hasn't stopped altogether, it's slowly becoming something more amusing than informing.

On vacation, though, it doesn't even amuse. It's more an annoyance that seems to encroach on the precious moments away from the financial office. And that's pretty much what it was this past week.

Meanwhile, vacation has been some combination of "off" and "strange" compared to previous years in the same place at the same time of year. Weather is weather and there's nothing one can do about it. But when you go to the same place for a few decades, you've got a pretty good history of how things typically unfold weather wise. Of course, there are variations, some more than other years. But this year was, well, "off" and "strange." 

Rather than bore you with the details, let's just say it seemed appropriate given what's been going on in the economy and the markets. More so, though, it seems sympatico with what's going on in the world - especially war-wise.

And while one tries to vacate the usual concerns and worries while on vacation, one can't really extract oneself from the concerns that have begun to bubble up as the bombing in various parts of our world continues to increase. It's almost like the prognosticators calling for World War III have been right.

Isn't it?

Well, vacation will be over soon. So I guess there will soon be time a-plenty to put some brain power into figuring out whether the world is on fire or not.