The Fed’s Self-Absolution

I want to highlight a passage from Jeffrey Snider’s most recent and characteristically opaque post at RealClearMarkets:

The combination of the history of the eurodollar futures market plus the 2011 transcripts provides us with the whole narrative, or at least enough of it to be meaningfully comprehensive. Thus, the scale of reversal has been total – first if the Fed would act, then whether it could act, and now, a decade later, if it ever can. And to that evolution the FOMC has decided that the problem was never money but Baby Boomers and a labor market filled with drug addicts and lazy Americans (I’m not kidding). Of course they would come to that conclusion because to admit the problem was money all along would be to admit they failed in every way possible. In one 2011 breath, they would talk about all those bank reserves as if the world was filled with dollars, but then in the very next describe all the ways in which the world clearly wasn’t. Thus, they had their eyes all the time on the problem but could never see it, certainly not in the way the eurodollar futures market finally did, and as a matter of experimentally established fact.

The emphasis is mine. It appears that the members of the Federal Open Market Committee are bitter clingers, too. Except that they’re clinging bitterly to the notion that neither the near-collapse of the financial system nor the subsequent phlegmatic recovery is their fault.