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Dave M
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Market Talk / June 25 - July 1
- Thread starter Spaf
- Start date
Markets reacting sharply to lower inflation data in revised GDP report at 8:30. Bonds did an abrupt about face from lower across the board and are all now up. Dollar was up against both Euro and Yen, now heading straight down. U.S stock futures up.
Is it all real? This market is like a coiled spring, wanting desparately to explode.
Is it all real? This market is like a coiled spring, wanting desparately to explode.
- Reaction score
- 2,241
This market reaction is one I didn't even consider - a big rally in front of the Fed announcement. OK, who leaked the info?
"They" are saying that if this rally is for real and we are up triple digits later on, money managers will have to get on board for the sake of their quarterly reports. They only have two days to do something and most funds have a loss for the quarter. They won't want to miss any rally at this point.
"They" are saying that if this rally is for real and we are up triple digits later on, money managers will have to get on board for the sake of their quarterly reports. They only have two days to do something and most funds have a loss for the quarter. They won't want to miss any rally at this point.
SkyPilot
TSP Pro
- Reaction score
- 40
Maybe a raise and a pause, then a raise. Fed could still trend up for a while, but at a slower rate.
This would allow them to maintain credibility as inflation hawks, but still try to demonstrate sensitivity to the relative health and momentum of the economy overall.
Just a thought.
This would allow them to maintain credibility as inflation hawks, but still try to demonstrate sensitivity to the relative health and momentum of the economy overall.
Just a thought.
- Reaction score
- 2,241
That would be OK. I wonder how they would present that? Would they keep using the word "measured." We'd want them to say something like the last 16 rate hikes are showing signs that the economy and inflation are under control.
I'd still like to see them do a one (1/2 pt) and done, but I doubt it will happen.
I'd still like to see them do a one (1/2 pt) and done, but I doubt it will happen.
Birchtree
TSP Talk Royalty
- Reaction score
- 143
At this point I don't care what those fools at the Fed do to ruin our economy - they won't succeed. The market rules. It is a good day to be in to win. I can hear the sound of hoofs in the distance. The Fed will probably pause with indications to remain vigilant later with more increases if necessary. That keeps the wall of worry intact - we don't want the 50 million Frenchman in on the next 3000 points up.
- Reaction score
- 2,241
A couple of minutes until the Fed announcement and the Dow is still up nearly 90 points. Strange if you ask me. If we get some good news and rally strongly into the close, we may have wished we took a little off of the table. That is if your timeframe is short.
Then again, we are heading into the strong seasonality of early July. It should be interesting the next week or so.
Then again, we are heading into the strong seasonality of early July. It should be interesting the next week or so.
Chaser
Investor
- Reaction score
- 2
Uncle Ben's statement
http://www.federalreserve.gov/boarddocs/press/monetary/2006/20060629/
The Federal Open Market Committee decided today to raise its target for the federal funds rate by 25 basis points to 5-1/4 percent.
Recent indicators suggest that economic growth is moderating from its quite strong pace earlier this year, partly reflecting a gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices.
Readings on core inflation have been elevated in recent months. Ongoing productivity gains have held down the rise in unit labor costs, and inflation expectations remain contained. However, the high levels of resource utilization and of the prices of energy and other commodities have the potential to sustain inflation pressures.
Although the moderation in the growth of aggregate demand should help to limit inflation pressures over time, the Committee judges that some inflation risks remain. The extent and timing of any additional firming that may be needed to address these risks will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information. In any event, the Committee will respond to changes in economic prospects as needed to support the attainment of its objectives.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Susan S. Bies; Jack Guynn; Donald L. Kohn; Randall S. Kroszner; Jeffrey M. Lacker; Sandra Pianalto; Kevin M. Warsh; and Janet L. Yellen.
In a related action, the Board of Governors unanimously approved a 25-basis-point increase in the discount rate to 6-1/4 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, and Dallas.
http://www.federalreserve.gov/boarddocs/press/monetary/2006/20060629/
The Federal Open Market Committee decided today to raise its target for the federal funds rate by 25 basis points to 5-1/4 percent.
Recent indicators suggest that economic growth is moderating from its quite strong pace earlier this year, partly reflecting a gradual cooling of the housing market and the lagged effects of increases in interest rates and energy prices.
Readings on core inflation have been elevated in recent months. Ongoing productivity gains have held down the rise in unit labor costs, and inflation expectations remain contained. However, the high levels of resource utilization and of the prices of energy and other commodities have the potential to sustain inflation pressures.
Although the moderation in the growth of aggregate demand should help to limit inflation pressures over time, the Committee judges that some inflation risks remain. The extent and timing of any additional firming that may be needed to address these risks will depend on the evolution of the outlook for both inflation and economic growth, as implied by incoming information. In any event, the Committee will respond to changes in economic prospects as needed to support the attainment of its objectives.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Timothy F. Geithner, Vice Chairman; Susan S. Bies; Jack Guynn; Donald L. Kohn; Randall S. Kroszner; Jeffrey M. Lacker; Sandra Pianalto; Kevin M. Warsh; and Janet L. Yellen.
In a related action, the Board of Governors unanimously approved a 25-basis-point increase in the discount rate to 6-1/4 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, and Dallas.
James48843
TSP Talk Royalty
- Reaction score
- 840
Two words....
YEEEEEEE HAAAAWWWWW!
YEEEEEEE HAAAAWWWWW!
