You’re alone, said the Fed to the panicked market

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The dog that didn’t bark overnight in Wednesday’s market dog was real US Treasury yields, the safe haven of choice during stock market crashes.

Real yields rose as stocks slumped after Federal Reserve Chairman Jerome Powell and other Fed officials warned monetary policy could not get the U.S. economy out of what the president said. the Cleveland Fed called it a “deep hole.”

Don’t look at us, Fed officials said in so many words. The US economy needs more fiscal stimulus from Congress. But Congress is deadlocked on a new spending bill ahead of the November election.

The inflation-protected 10-year Treasury yield rose 2.4 basis points, while the S&P 500 fell 2.37% and the NASDAQ lost 3.02%, leading to the S&P is a hair’s breadth away from a correction and pushed tech stocks well into a correction.

Gold fell $ 38 and the dollar rose. Investors have liquidated assets – stocks, bonds, currencies and commodities – in favor of liquidity, rather than seeking refuge in traditional hedges such as inflation-linked bonds.

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