So now we have all noticed that the Fed eschewed tightening a week and a half ago, and we have digested all of the analysis of the “negative dots” which indicate some member of the Fed projected not just unchanged rates but actually negative rates.

(Incidentally, here is a good article in The Telegraph about Sweden's negative rate regime. One of the observations worth pondering is that in a cashless society, there is no zero-percent floor on interest rates: normally, rates below zero percent shouldn't be possible since someone can always earn zero percent by holding cash. Unless there is no cash. That is simultaneously a deep thought and a terrifying thought – if there is no cash, and all of your money is in electronic deposits at financial institutions, then there is no limit to how much you can be robbed of – or in popular financial parlance, no limit to the “financial repression” that can be visited upon you.)

And we have read all of the analysis of Yellen's coughing spell after she appeared to express a desire to tighten in 2015 anyway, as long as it is later, and as long as – well, you know, as long as things work out. The NY Fed's Dudley today echoed Dr. Yellen; but Chicago Fed President Evans (father of the eponymous rule) opined that further delay is acceptable and desirable.

In other words, we are just exactly where we usually are. It depends. One of the great imponderables, of course, is “on what does it depend?”

For what it is worth, which to be sure isn't much, I think the Fed is terrified about that first step. If the Fed tightened and the world didn't end (and indeed, I don't think it would end; or, alternatively, judging from the stock market's behavior recently it may already be ended before that), then I think they would tighten again…and again, and again. And I think they would keep tightening until markets cracked and/or the economy swooned, whereupon they would begin a panicky easing campaign. That is, after all, the record of the last three decades or so.