The markets continue to look up into the sky to get a better read on the outcome of next week’s Fed meeting. There is an 80% chance that after a seven year stagnation, the Fed will raise interest rates at their concluding meeting of 2015 next Wednesday.
Before you pull out your Field Guide to research the species in this picture that appears to be Janet Yellen dressed like a Broadway star, or if you think it could be a molting bird with the head of an old lady, let me explain. In the economic sense of the word, a “hawk” is someone who believes that interest rates should be higher to keep inflation low, while a “dove” believes that interest rates should remain low to stimulate economic growth. The Fed’s mission is to provide a stable monetary system including maximum employment and stable prices, and they do that by regulating interest rates. Hence the depiction of the Chair of the Federal Reserve, Janet Yellen, with the body of both representative birds.