VGLT - Is It Time For The Fed To Ditch The Dot Plot?
By Eric Winograd
The magnitude of recent market reactions to the Fed's comments makes it clear that communication between the Fed and the market isn't working: the market is too focused on the Fed - and not enough on the economy. One solution? The Fed should stop giving forward guidance about rates - and eliminate the "dot plot."
Not long ago, forward guidance was a useful tool for the Fed. It was arguably the primary tool of monetary policy when the target rate was at zero - even more than quantitative easing. But with rates