Opinion: the actions of the current Fed indicate that it has a slightly dovish bias and therefore we should still be bullish asset prices.

We don't see the world as it is, we see it as we are.

-Anais Nin

The future is fraught with uncertainty, and no one has a crystal ball. We are all trying to predict what the Fed does based upon our own personal biases, of which we all have many. Our forecasts probably say way more about our positions than they do the future. And while these biases are impossible to remove entirely, I believe that on the balance, the current Fed fundamentally leans dovish.

They like growing the economy. And they really don't like job losses or economic slack. When making a decision, they rather err by making too many jobs than too little.

While it's obvious now that price stability is their top priority, I believe they still care a lot about unemployment and will genuinely do the absolute best they can to achieve a soft-landing.

Whether they can successfully do that is very much up for debate but past actions continually support that they tilt dovish.

• 2016 rate hike cycle was very gentle. Extremely well-telegraphed, minimal surprises.
• Paused QT without making a significant dent in the balance sheet.
• Clear willingness to take dramatic and unprecedented steps when presented with a crisis, like in Covid.
• Inflation evidence was building fairly strongly way before the commodities crisis spurred by the Ukraine war. CPI was almost 8% without the invasion.
• They probably could have started to unwind sooner, many were calling for it but they were quite resolute despite pressure.

All in all, it seems that while reflexivity and uncertainty can make it close to extremely difficult to predict the future, I believe a sober look at the Fed's actual actions indicate that generally they tilt towards easy money.