By Tom Bradley

This morning, we breathlessly watched the countdown to the U.S. Federal Reserve’s decision on interest rates. At 11:00 AM PDT, the decision came down to leave the key lending rate at zero (yes, zero). The commentary with the decision cited economic weakness from around the world as a reason to not start normalizing interest rates.

So here we are. Not only is the Fed micro-managing the U.S. economy, but now it’s succumbed to pressure from foreign interests, including the World Bank, and will keep the interest rate heroin pumping for the benefit of the whole world.

As noted in previous posts on central bankers, we think the talk about current market conditions impacting the Fed’s decision is absurd (it’s popular now to refer to the decision as ‘data dependent’ – i.e. the Fed is watching the monthly employment and economic numbers). Pull back from the noise and hype and think about it - we have ‘crisis-level’ interest rates (zero!) in a relatively normal economic environment. To be sure, things aren’t perfect, especially in Europe, China and some developing countries, but slow recoveries and uneven monthly economic data do not constitute a crisis.

In our recommended strategy to clients (updated today), we try to keep the noise to a minimum and focus on building portfolios for the next five years. As we note in the piece, “it’s important to remind ourselves of key investing fundamentals: focusing on valuation, sticking to a long-term plan and diversification.” If we do that, there’s no need to hold our breath.