The latest talking head chatter deals with the recent Fed Meeting and the perception that somehow the Fed is now ” behind the curve”. With the jobless rate falling (under various measures-U3,U6) and prices moving up towards the Feds target rate, there is some that now question why the Fed is not moving more quickly towards the normalization of rates. The retort to those that pose this question is: THE FEDERAL RESERVE POLICY OVER THE LAST 5 YEARS HAS BEEN TO STAY BEHIND THE CURVE. The Federal Reserve has consistently stayed behind the curve by simply shifting their policy targets once they have been met or exceeded. The only question, in our minds, is why the only curve that matters (The yield curve) does not adequately reflect this. Equally as confusing, has been the lack of investor demand in those areas which might optimally take advantage of this purposeful lag in policy (Hard Assets).