One line posts are frowned on because like this one, it is hard to know what the poster means.
So, what is headroom? And, what does the stock market have to do with "Should the Fed pull the rug out from under the American economy?"
We have periods of growth and recession.
Guess which one is up next..
I knew you could do it..
Which is why I think the Fed has been overreacting.
*Frown away*, Steve -- all it takes is a *follow-up* for clarification.
'Headroom' just means how-much-leeway-does-the-Fed-actually-have-to-work-with.
Take a look at the *other* thread, which is more on-point:viewtopic.php?f=9&t=182195
Again, it's a classic *dilemma* that the Fed is facing, because the U.S. economy has been running on *government debt* for two decades now, and its 'credit line' (so-to-speak) is now *tapped-out*.
There's some speculation as to how much 'extra-mileage' the reserve currency status thing confers, but my guesstimate would be 'only somewhat' -- and then the debt-to-ratio thing kicks in anyway, regarding investment risk and foreign confidence in the dollar.