As expected, today's Fed Minutes were a non-event.  Well, almost...  While the bulk of the Minutes release was simply a wordier version of the October Fed Announcement, there was a subtle addition that--in conjunction with recent Fed comments--bears ongoing observation. 

Actually, it wasn't so subtle.  The minutes spent several paragraphs recounting a discussion and the presentation of models regarding the lowering of the short and long term "natural" Fed Funds Rate--a magical level that keeps the US economy at equilibrium with full employment and price stability.  The simplest way to think of it would be to say if the Fed hiked to the natural rate right now, and if nothing else in the world changed, unemployment and inflation would hold steady.

At the end of those paragraphs, the Minutes indicated "some participants" said it would be good to have additional policy tools in case rates get stuck too close to zero, thus robbing the policy rate of its traditionally perceived power.  This is actually a pretty big deal, and we'll definitely be talking more about it in the coming days, but markets only cared about whether the Fed seemed to deviate from its rate hike stance from the October statement.  It did not, and so bonds did nothing with the data.  To be fair, stocks did move higher, but most of their move off the lows happened from 6am to noon Eastern. 

Bond markets ended the day almost perfectly unchanged, and made no further attempts to break today's highs or lows.  In other words, there was a consolidation ahead of the Fed, and trading levels didn't even break out of that consolidative pattern after the Fed.  Normally when bonds consolidate ahead of a key event, they'll break out of that triangular trading pattern after the event.