* Today was a day of damage control for the Federal Reserve

* It almost seems like whenever they discuss the possibility of a rate hike, they're really launching a trial balloon

* They want to gauge the possibility of a rate hike and then if the market kind of shrugs it off, or blesses the rate hike the way it did last year nearing December, if the market seems it's OK with a rate hike, then maybe they'd consider actually implementing one

* But before they do it, they want to test the waters, they want to see how the market reacts to that possibility

* Clearly, the near 400-point decline in the Dow on Friday showed that the market really wasn't very friendly to the possibility of a rate hike

* Let alone the certainty of one

* Just the mere possibility, however remote, really spooked the market

* Today the Federal Reserve had a chance to dial it back

* They had 3 Fed presidents speaking today, and not one of them talked about the possibility of a rate hike

* Starting with an 8am talk this morning by Atlanta Fed President and CEO Dennis Lockhart

* Now Dennis was specifically asked about a rate hike, and whether he thought the Fed would move in September or December

* He specifically refused to comment

* He said, "Financial markets seem to be very sensitive to the remarks of Fed speakers at the moment"

* And so in light of market sensitivity, he refused to answer the question

* Why not answer it? Don't you want to prepare the markets for a possible rate hike?

* Well they don't want to say what they want to do, because they don't like the way the market is reacting

* You'd better believe that if the markets reacted favorably to a rate hike, they would have stayed on script

* Because of the the sell-off on Friday, and where futures opened before Lockhart's speech, the Dow was set to open up down 100 points or more

* But once he spoke, all of a sudden, people were thinking, "Hey wait a minute, he didn't say anything about a possibility of a rate hike and he's worried about the markets' sensitivity

* The only thing he said that could have been interpreted as a rate hike comment was when he mentioned the data over the past few weeks "warrants serious discussion of a policy rate increase"

* The data over the past few weeks has all been bad

* All he said is, it warrants discussion of a policy rate increase, but he didn't say that we should be in favor of an increase, or against an increase

* He just said the data over the past few weeks warrants discussion

* To me, what that means is, we should discuss not raising rates because all the data we've gotten recently is weak

* It was the data we got a couple of months ago that supposedly let Janet Yellen conclude that the case for rate hike had strengthened

* But really, what Lockhart is saying is, "We need to have a serious discussion about a rate increase."

* Not that we have to discuss raising interest rates, but maybe we should discuss not raising interest rates because based on the data from just the past few weeks, one would argue against an increase

* If he had said, "We need to discuss an increase", he wouldn't have predicated it with, "the data over the last few weeks"

* That data, in and of itself, is not friendly to an increase

* If he was in favor of a rate increase, he would not qualify it the data over the past few weeks

* Also, just suggesting a discussion about a policy rate increase is not the same as actually increasing the interest rate

* A discussion to increase rates could lead to no rate hike

* Well, I assume they've been having discussions about raising rates for the last several years

* What else do they discuss over there?

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