The Fed's overtightening and the shift to a fiscal paradigm

The Fed's discomfort

For the better part of 4 years, I have been telling you that the Federal Reserve has been uncomfortable with a mid-cycle role which required it to keep rates at zero percent. The Fed sees its role as principally reserved for cycle turns and not as an agent of mid-cycle stimulus. Both Chairs Bernanke and Yellen expressed discomfort wi…