What to do if you are an overpaid, ivory-tower Fed Head? You want to keep raising the fed funds rate in order to benefit your owners but, at the same time, your higher rates are driving your stock market lower. Again, what to do, what to do?
Below you can see El Problemo. When the yield on the 10-year note first got to 3.25% back on October 8, the S&P was near 2900. It immediately crashed. The S&P then bounced after bonds rallied, only to crash again when the 10-year reached back up to 3.20%. Last Thursday, the 10-year hit 3.25% and the S&P has since fallen well over...
