Fedspeak

The head of the Atlanta Fed, Dennis Lockhart, is  quoted in the NY Times as saying:

"The slowness in the first quarter obviously raises concerns that we’re going to see a continuing or persistent slowdown, but that’s not my base case view. My base case view is that we’ll see a rebound in the second and third quarter and beyond and that we’ll stay on the basic track that has been our story, our narrative here, for the last year or more. And that is a 2.5 percent to 3 percent growth rate with continuing improvement on the employment front, and gradual rise in inflation toward the 2 percent target. So to some extent I’m taking on a Wilbur Mills position: That’s my story and I’m sticking to it."

So the "story" is that we were in a short term tough patch this past quarter but will bounce back this quarter and next to a 2.5-3% growth rate. Yep, that's his story and he's sticking to it.  I like this guy.  At least when he is telling you what he knows to be a "story" he flat out tells you he is telling you a "story" and does not feign that it is reality like most the Fedspeaks do.  His "story" is proven just that by the Atlanta Fed GDP Now site that is putting GDP forecast for the year at .1%.  As I have noted recently, that is a drop of nearly 2% in the forecast in two months, which is huge.

Now compare this to the Fedspeak from John Williams, head of the Fed in San Francisco, as quoted in the Wall Street Journal:

"'Things are looking better–in fact, they’re looking downright good,' the official said in a speech to be delivered to an audience in Sydney and Melbourne via video.
Given how much the economy has improved and is likely to continue to gain ground, “I think that by mid-year it will be the time to have a discussion about starting to raise rates,” Mr. Williams said.
The strength of the U.S. dollar against a “broad index” of currencies is not an impediment to the U.S. economy reaching real GDP growth of 2.5% this year, he said.
“The U.S. economy has good momentum…even with what is a rather large appreciation of the U.S. dollar,” Mr. Williams said."

So this guy really seems to be buying his own "story" or, as they say, drinking his own Kool-Aid.  The problem with this Kool-Aid, however, is they drink it and we are the ones that suffer.

For more on some of the other Fedspeak, here is link to a nice article that discusses the less than spectacular employment data out today, which includes a worthy collection of recent Fed quotes on the economy, including those I noted above.

http://economistsview.typepad.com/economistsview/2015/04/fed-watch-air-pocket.html

Add to this some former Fed Fedspeak from Bernanke's new blog on how the Fed does not create bubbles or distort markets, and you will have a nice laugh for the weekend.

http://globaleconomicanalysis.blogspot.com/2015/04/thrown-under-bus-another-look-at-self.html

These guys (and gals) really crack me up.