Update: Yellen repeats call for higher rates - Won't say when

Read Janet Yellen's prepared remarks here. Highlights (from @PhillyJoeD, my Twitter feed):

Stone says the "implied probability" for a June rate hike fell to a 1 in 25 chance, from nearly 1 in 3 before the report. He now rates a July hike at just over 1:4, down from better than 1:2, "barring a major surprise" from Yellen today.

Mayer, in common with many bank and brokerage economists, has been a critic of cheap money, which has failed to spark rapid economic growth.

Instead of investing to boost profits from growing demand they aren't sure is coming, "companies have been taking the growth in free cash flow and
returning it to shareholders in the forms of stock buybacks and increased dividends," writes Mayer.

These payments make shareholders richer but "provide no enduring economic benefit. The net result is slower gains in productivity. To offset the weaker productivity, companies have started to pull back on hiring plans."

Recent comments from other Fed officials have also been "mixed," Mayer notes. "Some say the data on Friday suggests waiting a while longer. Others say rate normalization should continue albeit maybe not in June. Ms. Yellen's comments this afternoon will obviously be watched very closely."

Even an 0.25-percent rate hike is more symbolic than real, Mayer added.

"If the Fed doesn't raise rates in either June or July waiting for more confirming data, it is entirely possible that it won't raise rates at all this
year assuming economic growth remains near 2%, wage growth remains below 3% and jobs continue to climb at a pace closer to 100,000 than 200,000.

"If the Fed chooses to raise rates in September, it will have to tolerate
kick back from the Presidential candidates. Most suggest December is the next best opportunity and that appears logical.

"But if the data in December is roughly the same as it is today, the FOMC may still be too divided to move. The odds of a December hike would now be only 50-50 or a tick higher." Which means stock prices will stay stuck in their recent "slow slog." He sees no signs of a recession; the Fed's and other central banks' obsession with "excess money creation" will "almost certainly" mean continued "very slow growth, low productivity and very slow increases in profits."