All eyes and ears will be on the Fed today. But it doesn't matter what the Fed does or says.

In about an hour the Fed will give its much-anticipated rate hike decision. Analysts will pore over every word looking for changes. And they will find them.

I expect a new word today: "extra". We will be extra vigilant, extra-cautious, extra data-dependent. Perhaps it's "more" vigilant, or "even more" vigilant etc., to stress the notion the Fed was vigilant when it wasn't.

Whatever, the meaningless word change, analysts will yap about it for the next week or even month as if it matters. But it doesn't.

Bubbles Can Only Get So Big

At some point in every Fed-sponsored asset bubble, the bubble simply cannot expand any further. It's like a Ponzi scheme. Eventually, the pool of greater fools runs out.

And consumers just stop buying. They can no longer afford houses. Perhaps they have one too many already.

Earnings estimates start to fall. Businesses don't want to expand because consumers buy less stuff.

Rate Cuts Coming

The Fed will hike today, or not. It doesn't matter because it is simply too late to matter. Yesterday I wrote 2019 Rate "Cuts" in Play.

That won't matter either. It's too late to matter.

What Does Matter?

What matters is the massive amount of financial speculation and stunning amount of junk bonds. What is widely known as the "Everything Bubble" was fueled by corporate buying for anything and everything whether or not companies could turn a profit.

Fed-Induced Bubble

The Fed helped blow this bubble the by keeping interest rates too low, too, long. By encouraging financial speculation and consumption all in the nonsensical battle to fight price deflation.

CPI Deflation Not a Problem

The BIS did a historical study and found routine deflation was not any problem at all.

"Deflation may actually boost output. Lower prices increase real incomes and wealth. And they may also make export goods more competitive,” stated the study.

For further discussion of the BIS study, please see Historical Perspective on CPI Deflations: How Damaging are They?

Rise of the Zombies

Meanwhile, take stock of the [Rise of Zombie Corporations](Rise of the Zombie Corporations).

And take another look at the lead chart There Have Never Been So Many Bonds That Are Almost Junk.

Credit Spreads Signal Recession

Finally, note that $176 billion worth of corporate bonds has fallen from 'A' to 'BBB' so far this quarter - the highest since late 2015.

Importantly, and unlike 2015, it's not just oil-related.

Bulge of BBB-Rated Debt

The BIS Fears "Bulge of BBB Debt" and "Financial Cycle" Default Waves as it should. And on top of it, Credit Spreads Signal Recession.

People believe one extra rate hike or cut matters. Phooey. It's far too late to matter what the Fed does now.