It's a Jedi mind trick that you think they will taper. They would love to keep yields down with their tapering talk without having to taper. In that scenario, they could inflate the equity bubble more and get more trickle down wealth effect. But if yields rise, then everything goes down. They can't taper because all the equity gains will vanish. The Fed is indeed trapped.
Isn't this just lip service now? I don't know how anyone could take seriously anything Fed members say anymore. Their credibility is shot. The market will now approach tapering with the assumption of QE forever until they taper. If they're not going to do anything, they should just shut the #$%$ up.
very good interview on bloomberg in premarket with tom keene with st louis fed gov bullard, really like that guy, and pointed out just how close the taper call was and strongly implied could happen later this year.
there are many economists that point out what the fed is wise.
i personally think they should back off but others that i respect have come out and said what the feds did was very wise.
good right up by evans pritchard the other day about the fed decision, a worthy read.