freak-outs have been a precursor to higher stock prices as higher rates have signaled a stronger economy and better earnings for US corporations.

Market Volatility and Fed Policy

Jerome Powell

This headline out of CNBC may have added to the market's edginess today: “Fed chairman Powell: market volatility won't stop more rate hikes.”

This, according to a friend, was a statement that the “Fed Put” (a terminology used in the early stages of the last recovery to signify a perceived willingness on the part of the Fed to stop at nothing to support stock prices) was gone. Real or imagined, in today's strong economy and market there is no need for a “Put.”  It is simply good policy to bring the rate structure in this country back to a more normal position because it gives the Fed dry powder for future economic pitfalls, and because it finally starts to put some money into the pockets of those who have saved but are fearful of stocks.