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Even the Mainstream Sees the Disconnect Between Fed Rhetoric and Actual Data

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The Fed is hawkish about jacking up interest rates, but even the mainstream is catching on to the disconnect between Fed rhetoric and actual data.

The recent Federal Reserve rate increase and talk of more boosts in the future has sparked a rally for the dollar. This has caused the price of gold to sag. But TJM Institutional Services managing director Jim Iuorio recently said on CNBC’s Futures Now that he’s still bullish on gold because he thinks the Fed’s hawkish tone doesn’t line up with actual economic data.

I’m a longer-term bull in gold and if you look at the long-term chart the trend is still higher. What the Fed said yesterday is disconcerting to the market, and that’s why the dollar rallied so hard. But as we start to move away from that, we start to see some data that is deteriorating, the dollar should shrink back again and gold should be fine.

Iuorio also echoed what Peter Schiff and others have said about the disconnect between Federal Reserve rhetoric and actual economic data.

I’m getting a little bit concerned. There is a disconnect between what the Fed says and what the market thinks the Fed should be saying. Every time we hear from them, they start to talk hawkish, and then we see the data, and the data actually seems to be deteriorating a bit.”

In fact, Jim Rogers recently said we should expect the worst crash in our lifetime in the near future.

Iuorio didn’t go that far, but he did say he just doesn’t think the Fed can continue on the aggressive path of interest rates hikes they’re talking about.

I just don’t see how they can keep this tough talk despite the fact a lot of things just don’t look that great…I think they hiked yesterday because they said they were gonna. At the end of the day, they looked and they said, ‘We can’t change our mind now because that will roil the markets more-so.'”

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