So the Federal Reserve has sprung its non-taper surprise on the financial markets – now what? The good news is twofold: the decision avoids the worst-case scenario of taper plus economic stagnation, while the Fed retains the element of surprise and demonstrates that it is not in thrall to the markets. The bad news is also twofold: the Fed remains stuck in a policy mix that both distorts financial markets and does little to help the real economy (one can argue that it even hurts the real economy, given the 100-bp run-up in yields since May). Investors and policymakers alike remain focused on the search for growth, a search the Fed decision implicitly suggests will continue for the foreseeable future.