The notes from yesterday’s Fed meeting have managed to spur back-to-back down days in the market, seemingly all based on the lack of language hinting at an immediate round of Quantative Easing. This market is hooked. It fiends for stimulus injections, pitching a tantrum at the slightest hint of being denied what it assumes is “promised.”
This reluctance to dole out yet another “dose,” this sign of maturity on the part of the Fed is a glimmer of hope that fiscal responsibility is on the horizon. Over medicating is a self fulfilling prophecy, spiraling into the depths of physical reliance. And detox is the answer, which is precisely what the past two market sessions have yielded. But don’t you worry… Should the sickness persist, we won’t hesitate in the least to synthesize a solution. Prescribing ourselves back to the pristine picture of artificial health that we are today.
Nice job on that one. I think you are spot on. But what if Dr. Kevorkian wins the election?
What do money managers really think of Fed policy as they look out 6-12 months – and are zero rates enough? I think they see a US economy growing and they believe that the Bernanke Fed is doing a solid job. Just as important, Ben and Co. are communicating very clearly about what they see.
If we have Ron Paul in 2012, I think you can kiss this theory goodbye..
Very true George.. In a Market that focuses so incredibly closely on the Fed’s language, Bernanke’s ability to telegraph both their outlook and intentions has managed to take some of the volatility out of his speeches. I have to agree that while the Fed isn’t perfect, their level of communication is impressive for a government entity.