Weekend Economists Silent Night Christmas Eve 2014

[Demeter]

21. A visit from Janet Yellen Posted by Macro Man

http://macro-man.blogspot.com/2014/12/a-visit-from-janet-yellen.html


‘Twas the night before Christmas; yup, that time again
For punters to go limit long dollar/yen;
French SMEs filled out their loan apps with care,
In hopes that the ECB soon would be there;
Rates traders were shorting ED’s in the reds;
While visions of tightening danced in their heads;

Mamma was long AAPL, and I was long Schatz,
We’d just settled our brains ‘round the Fed’s stupid dots,
When the texts on my phone, they gave off such a clatter
I logged onto my screens to see what was the matter.

Away to the news feed I flew like a flash,
Pulled up my price screens quick as Bolt in the dash.

The chart of prompt oil had just one way to go,
With a warning it screamed, “HEY! LOOK OUT BELOW!”

When what in my wondering eyes did I see,
But a small red headline from the FOMC,
With a little old lady who said, “Don’t be sellin’”,
I knew in a flash that it was from Yellen.

More slowly than snails, their changes they came,
She harangued the committee and called them by name:
“Now Mester, now Fischer, now Powell and Plosser!
On Dudley, on Brainard, and Lacker, you tosser!
To the top of the chart! Just you watch NAIRU fall!
Now sit tight, now sit tight, now sit tight you all!”

As energy high-yield, which no longer shone,
Took note of the oil price and dropped like a stone;
Way up to the heavens, the dollar it flew
Against euros and yen, and the Canada too-
And then, in a twinkling, I heard on the floor
The sound of some traders being shown to the door.

As I just shook my head, and was turning around,
Janet Yellen appeared without making a sound.
She was dressed all in gray, from her head to her toe
And she stamped her small feet to shake off the snow;
A bundle of charts she had flung on her back,
And she looked like a bank strat as she opened her pack.

Her hair, it was white like the helmet of Stig
And I thought to myself that it must be a wig,
Her movements were languid and slow like a panda’s
Her voice? It sounded just like Estelle Costanza’s.

She showed me inflation and the U-rate too
I knew for a while there’d be nothing to do;
She said she was patient, no lift-off in sight,
And that when it comes that they won’t get too tight.

I mentioned the secular decline in prices
She claimed it was just the result of the crisis;
“The Phillips curve works- it’s just flatter, you see
Hmmph. Globalized labor means nothing to me.”

And then she ignored me and went straight to work
I could tell that she found me a bit of a jerk.
And laying her finger aside of her nose,
And giving a nod, equity prices rose;
Then giving a wink, and a shake of her hair,
That’s the last that I saw of the tiny Fed chair.

But I heard her exclaim ere I opened a beer,
“Happy hols to you all and I’m hiking next year!”