Hopes that only groovy times are ahead for the U.S. financial markets were dampened slightly in the third quarter, according to a report by analyst James McKee of Callan Associates Inc., San Francisco.
His report, "The Fed Who Bagged Me," illustrates the quarter ended Sept. 30 with characters from the summer movie, "Austin Powers: The Spy Who Shagged Me."
Mr. McKee considered whether Federal Reserve Chairman Alan Greenspan played the role of Dr. Evil by "warning the world that the Fed has to increasingly focus on changes in asset values to determine whether inflationary pressures are building."
"Concerned that stock prices were starting to drive the economy, the Fed was threatening to steal the market's mojo. Higher interest rates would be the Fed's natural weapon of choice," Mr. McKee wrote.
The Callan Micro-Cap index, which Mr. McKee called "a veritable Mini-Me of the broad market index," closed the quarter with the most modest loss, -3.1%.