Off the Cuff: The Fed is Speaking out of Every Corner of Its Mouth

In this week's Off the Cuff podcast, Chris and Charles Hugh Smith discuss:

• Decoding FedSpeak
  • Deciphering the latest Fed minutes
• Pricey Petroleum
  • Crude oil cracks $106/barrel
• Fed Losing Control?
  • Outlook for stocks/bonds/real estate looking shaky

Today the latest FOMC (Federal Reserve Open Market Committee) meeting minutes were released. These show what the members of the FOMC board were thinking during the meetings that led up to Ben Bernanke's cryptic comments about a "taper" of Fed asset purchases at some point in the future.

The records show several of the FOMC members were surprisingly aggressive in their desire to begin the taper sooner than later. But other comments show "many" favored bond purchases continuing well into 2014. Given the doublespeak, many analysts rightfully criticized the Fed for appearing to play word games that would provide some sort of cover no matter what happens in the future. 

Fortunately, Bernanke did provide some further clarity at a speaking event later in the day (which occurred after this Off the Cuff episode was recorded). Essentially he said that, given economic weakness and stubbornly high unemployment, the market can expect the Fed to remain accommodating into the foreseeable future. He went as far as to say that while asset purchases may well taper, the Fed is committed to maintaining the current low interest rate.