The Economy: The Fed’s latest buzz-word is the “High Pressure Economy.” … as in The Fed is going to run a “High Pressure Economy.” The High Pressure Economy is one in which inflation is allowed to run beyond levels deemed prudent. It’s the latest Fed-Speak for managing a sluggish economy that refuses to respond to 8-years of unbridled stimulus and low interest rates. While the focus is on whether the Fed will raise interest rates in December, attention might be better placed in the future. Another ¼ point hike in rates isn’t going to do much more than blow marginal players out of dubious deals. But keeping interest rates artificially low for several more years will have a significant impact on many aspects of society. Pension plans are especially at risk. Yellen rules until at least 2018 possibly 2022. Bigly. Come the new year, the voting members of the Fed Open Market Committee (FOMC) who are hawks, reach the end of their terms. Coincidently, their replacements are uber-doves who will play into Yellen’s “lower for longer” policy. Inflation is persistently running below target. The U.S. and global economies are showing weak to inconsistent metrics. Why would the Fed feel compelled to raise rates at all?

Food for Thought: Finding safe income in a zero interest rate environment is a desperate challenge for investors in general and retirees in particular. Bank deposits and money markets are losers when you figure in taxes and inflation. The long treasury at 2.49% is a bust as well. Dividend paying stocks are now being touted as the answer. But the dividend can always be cut and the stock can always plunge in value; even when inside an Exchange Traded Fund (ETF) or a mutual fund.

Music of the Week: Halie Loren’s “After Dark”