The Fed Is Scared of Stock Market Animal Spirits

The Breakdown

Blockworks

Investing, Business

4.8 • 786 Ratings

🗓️ 6 January 2023

⏱️ 16 minutes

🔗️ Recording | iTunes | RSS

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Summary

In today's episode, NLW looks at the macro landscape that will set the tone for the markets in 2023. According to the minutes of the December Federal Open Markets Committee Meeting, released on Wednesday, the Federal Reserve is concerned about investor enthusiasm regarding a theoretical future pivot undermining monetary policy tightening. Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW - “The Breakdown” is written, produced by and features Nathaniel Whittemore aka NLW, with today’s editing by Michele Musso and research by Scott Hill. Jared Schwartz is our executive producer and our theme music is “Countdown” by Neon Beach. Image credit: Drew Angerer/Saff/Getty Images, modified by CoinDesk. Join the discussion at discord.gg/VrKRrfKCz8.

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.2	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:15.3	The breakdown is produced and distributed by CoinDes.
0:20.4	What's going on, guys? It is Thursday, January 5th, and today we are catching up on the
0:25.3	macro scene. Before we get into that, however, if you are enjoying the breakdown, please go
0:29.9	subscribe to it, give it a rating, give it a review, or if you want to dive deeper into the
0:33.8	conversation, come join us on the Breakers Discord. You can find a link in the show notes or go
0:37.8	to bit.ly slash breakdown pod. All right, friends, well, for the last couple days, as you know,
0:43.3	we have been catching up on crypto from over the break, but today we are going into the macro realm.
0:48.3	Because remember, before there was the wrecking ball of Luna and then 3AC and then Sam and now
0:54.0	maybe Barry, there was the macro environment and the Luna and then 3AC and then Sam and now maybe Barry. There was the
0:56.2	macro environment and the Fed just tanking all risk assets. In fact, this week we had something
1:02.5	of an anniversary. Yesterday we got the Fed meeting minutes from December and the meeting minutes are
1:09.3	kind of a chance for the Federal Reserve to give extra nuggets of information to drive markets in the direction they want.
1:15.1	It's not an accident that they're released weeks after the actual FOMC meeting.
1:20.1	They're used as yet another tool of self-fulfilling prophecy.
1:23.4	So if the Fed thinks the markets didn't get the message they were trying to send well enough
1:27.4	or got it too well, they can recalibrate.
1:30.4	This happened in dramatic fashion in January of last year in 2022.
1:35.5	In December 2021, the Fed confirmed at their FOMC meeting what everyone anticipated that
1:40.7	rate hikes were coming in 2022.
1:43.5	In fact, that confirmation drove markets higher, as pretty much everyone in the market thought
	...

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