US equity markets are tumbling from their pre-open algo buying-spree and while no obvious catalyst stands out, somewhat hawkish comments from former Fed head Yellen may have sparked some selling…

Yellen is speaking at a Mortgage Bankers Association conference in Washington:

  • *YELLEN SAYS 3% GROWTH IS TERRIFIC BUT DOESN’T THINK IT CAN LAST

  • *YELLEN: INVERTED YIELD CURVE A GOOD RECESSION SIGNAL IN PAST

  • *YELLEN: THIS TIME MIGHT BE DIFFERENT ON YIELD CURVE SIGNAL

  • *YELLEN: FED NEEDS TO MOVE RATES TO NEUTRAL, STABILIZE LABOR MKT

  • *YELLEN: NOT DESIRABLE FOR A PRESIDENT TO COMMENT ON FED POLICY

  • *YELLEN: POLITICIZING FED POLICY RISKS UNDERMINING INSTITUTION

So “keep hiking rates”…  “ignore the yield curve coz it’s different this time”, and “ignore President Trump…”

And the reaction – coincident – was notable…

 

 

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