A love letter to the adoring stock market Fed – Bloomberg


Dear Fed,

Hey! It’s me, the stock market. I know it’s weird writing to you like this, but I felt like I needed to drop a quick note of thanks for everything you’ve done for me this year. I mean, your big toll is almost $ 3 trillion more since early March! You back up the truck and load it up with treasury bills, corporate bonds, and bond ETFs, all to keep the competition with fixed income stocks as limited as I think Jim Cramer is. It’s a dream come true, honestly. I mean, confess: have you read my diary ?!

You might have noticed it, but everything else is a royal mess. Covid-19 is still killing people. Parents fear the start of “school”. Unemployment in the United States is still above 10%, higher than it has been since the 1980s. The country is facing the biggest economic contraction in its history. Corporate profits fall. The recession is expected to continue at least until the first quarter of next year. And me? I fly away! Have you seen these any records I set?

To be honest with you, it’s getting a little wild – and I’ve seen a lot of weirdness before. I am more popular with sports fans than March Madness! Of course, there hasn’t been any March madness this year, so it’s not really a fair comparison – kind of like comparing my dividend payments to bond market yields. Amirite or amirite? LOL!

But I’m not kidding when I say things are getting REALLY weird. Have you heard of Dave Portnoy, aka Davey Day Trader, again? He was just an average internet celebrity until he suddenly went viral for using Scrabble tiles to pick stock symbols. The Robinhood set thinks he’s smarter than Warren Buffett! This is probably not going to end well, I will tell you a lot.

Speaking of Robinhood, all that The Hertz saga was about as strange as it gets. A car rental company was trying to sell new stock while it was in bankruptcy court because its stock price was on a tear? Let me say it again: Hertz. Sold. Actions. While. In. Bankruptcy. I can not even! You are sure to keep your friends busy at the SEC! I mean it’s so weird out there Bloomberg Businessweek uses commendable satire to make sense of it all.

Speaking of cringey, what happened to the minutes from your last meeting? Don’t get me wrong, I haven’t really read them. If I had the attention span for this stuff, you would call me the bond market. Sure, the bond market has read the record, and they think you’re a little rude for not wanting to keep the party going. Look, I learned this lesson the hard way – and I thought you did too – so it’s worth repeating: do whatever the bond market says, okay? He’s taller, better educated, and sharper than the two of us.

So please give me a solid and keep this thank you note in mind when hosting your virtual Jackson Hole summit. No cowboy stuff, okay? If I hear someone mumble something about “irrational exuberance,” I swear I’m going to blow my top off and hurt a few of these Robinhood guys, you get it? The Lord gives, and the Lord takes away. This is what I do – and I am good at it! But right now it’s still a lot of fun for me… and when I end up burning people, do you really want to be the one who gets thrown under the bus? I mean, you know you’re gonna take all the blame, right?

Come on, Fed. We both know you’re smarter than that. What are a few billion more?

With sincere and deep gratitude,

The stock market

—Michael P. Regan is editor at Bloomberg News.

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