Consider the following and then tell me what you think is going on.
Paul Tudor Jones, on Monday: "If they say, 'we're on path, things are good' then I would just go all in on the inflation trades. I'd probably buy commodities, buy crypto, buy gold."
Trading as of 12 p.m. Thursday: Gold -5%, Silver -7%, Copper -4%, Palladium -10%, Bitcoin -0.5%.
Conclusion: Fed was hawkish.
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David Tepper, to Scott Wapner this morning: "I think the stock market is still fine for now," despite the hawkish dots yesterday.
Trading as of 12 p.m. Thursday: Dow -1%, Russell -2%, Vix +4%, Nasdaq positive. And the yield on the 10-year, which spiked to 1.54% after the meeting yesterday, is all the way back down to 1.48%.
Conclusion: Fed was maybe too hawkish, but Tepper says it will be fine.
Conclusion: If the Fed was possibly too hawkish by barely lifting its rate-hike forecasts, then the market thinks deflation is still a bigger threat than inflation.
Conclusion: Then the Fed should have done nothing, which would have goosed the inflation trades, thus reinforcing the price-pressure-problems and all the NGDP vs. potential GDP problems Michael Darda has been warning about.
Conclusion: Or maybe the Fed got it just about right?
Conclusion: My head hurts.
See you at 1 p.m!