Well, here we go again. It's time today for our Federal Reserve to once again razzle and dazzle the world with its brilliance and fabulous decision-making abilities.
No one expects the Federal Open Market Committee to raise rates when the group announces its decision at 2 p.m. ET this afternoon. But many predict Fed chair Janet Yellen will hint that the central bank remains committed to resuming tightening this year.
Why Fed members want to send that message is beyond me. I guess they're unable to read the headlines from the best and brightest in the tech world and other sectors.
Alphabet (GOOG, GOOGL), IBM (IBM), Intel (INTC), Netflix (NFLX), Starbucks (SBUX), Qualcomm (QCOM) and most recently Apple (AAPL) have all reported quarterly results that were pretty dismal. (And if you take forward guidance into account, they were even depressing.)
The latest U.S. economic figures haven't exactly been setting the world on fire, either. They've been a mixed bag that shows tepid and anemic growth at best and a weakening macro picture at worst.
Now admittedly, the data coming out of China have a slightly positive tilt. Beijing looks close to turning things around, and I've been hearing from friends who do business in China that both exports and imports are picking up strongly there.
Folks who support a U.S. rate hike based on "fantastic" domestic economic conditions are also constantly beating us over the head about how the S&P 500 has bounced back some 14% from its February lows.
But that's actually laughable if you think about it. Yes, stocks have rebounded since their February beat-down, but they're still trading at December 2014 levels. So, those who invest for the long term (a constant Wall Street mantra) have made bupkis. Those are the facts, Jack -- and don't be fooled into believing otherwise.
Another factor that could make the Fed believe we have sizzling U.S. growth is the fact that oil prices have rallied some 20% since the central bank last hiked rates in December. That might set the "Fed pointy heads" off on their inflation boogeyman.
But in the real world, there's absolutely no need for another hike. Conditions simply don't warrant one, either here or overseas. Despite their posturing, whistling past the graveyard and bombastic speeches about our "booming" economy, I believe Fed members are hard-pressed to justify even one more hike in the near future based on current global conditions.
I'll be back soon after this afternoon's FOMC announcement with my reactions.