The Wall Street Journal's Jon Hilsenrath says its time to start paying attention
Investors these days are obsessing over when the Federal Reserve will start raising short-term interest rates. Drawing less scrutiny is where rates will end up in the long run and how they'll get there. But it's time to start paying attention.
- Fed officials have made clear they expect to begin raising short-term interest rates from near-zero this year, though not before midyear.
- After that, there is great uncertainty at the central bank and in the markets about the future path of interest rates.
A disconnect between the Fed and the market over the long-run rate outlook also could be a source of market turbulence in the months ahead.
- Central-bank policy makers on average see rates going nearly twice as high as futures markets indicate in coming years
- If the Fed is wrong, it might make a mistake on interest rates that jars the economy
- If the market is wrong, it might be setting itself up for a tumble if rates go higher than expected
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More at the article, which is gated: Fed Ushers in a New Era of Uncertainty on Rates
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Uncertainty ...
The headlines often make out that it's a bad thing ... Can"t have yer hand held all the time though ...
