Zero is an interesting concept.  Just like infinity, it’s enough to make my head spin.  I just can’t grasp the concept of sheer and utter nothingness.  Fortunately, my attention span isn’t that long so I am not in danger getting too dizzy or even too deep in my philosophical pondering.  And yet, zero is the word that the Fed Fund Futures market is using to describe the likelihood that the Federal Reserve will raise rates this year.  Like for the rest of the year (remember that we are only in January).  Just last week there were all kinds of numbers being thrown around about the likelihood of rate hikes in each of the eight Fed meetings for 2016 and they were all in the double digits and some were greater than 50.  And now, zero.  Interesting stuff.

In yesterday’s pontification (which I won’t blather on about again here because it is, as they say, “yesterday’s news”–but you can find it at if you are really interested), I talked about market expectations and about how failing to meet them brings about unanticipated changes.  That is what we are seeing right now.  The granddaddy of all economic reports, the Gross Domestic Product (GDP), was just published for the fourth quarter of 2015.  Coming in at an annualized growth rate of 0.7%, the Q4 number drags the GDP for the whole year down to 1.8%.  The target rate of the Fed is currently 2.0-2.5% and many economists think that we ought to be greater than 3.0% to be creating the jobs that we need to keep up with population growth and pull ourselves out of this eight year slump.  Alas, our economic scorecard for the year reads 1.8%.  It’s better than a lot of countries, including Japan, and thankfully, that number is still greater than zero.