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FOMC Statement: No QE2, And August-September Statement Comparison
Rate Unchanged. FOMC says prepared to provide additional accomodation if needed support economic recovery, to raise inflation. No QE2 announcement.
Information received since the Federal Open Market Committee met
in August indicates that the pace of recovery in output and employment
has slowed in recent months. Household spending is increasing gradually,
but remains constrained by high unemployment, modest income growth,
lower housing wealth, and tight credit. Business spending on equipment
and software is rising, though less rapidly than earlier in the year,
while investment in nonresidential structures continues to be weak.
Employers remain reluctant to add to payrolls. Housing starts are at a
depressed level. Bank lending has continued to contract, but at a
reduced rate in recent months. The Committee anticipates a gradual
return to higher levels of resource utilization in a context of price
stability, although the pace of economic recovery is likely to be modest
in the near term.
Measures of underlying inflation are currently at levels somewhat
below those the Committee judges most consistent, over the longer run,
with its mandate to promote maximum employment and price stability. With
substantial resource slack continuing to restrain cost pressures and
longer-term inflation expectations stable, inflation is likely to remain
subdued for some time before rising to levels the Committee considers
consistent with its mandate.
The Committee will maintain the target range for the federal
funds rate at 0 to 1/4 percent and continues to anticipate that economic
conditions, including low rates of resource utilization, subdued
inflation trends, and stable inflation expectations, are likely to
warrant exceptionally low levels for the federal funds rate for an
extended period. The Committee also will maintain its existing policy of
reinvesting principal payments from its securities holdings.
The Committee will continue to monitor the economic outlook and
financial developments and is prepared to provide additional
accommodation if needed to support the economic recovery and to return
inflation, over time, to levels consistent with its mandate.
Voting for the FOMC monetary policy action were: Ben S. Bernanke,
Chairman; William C. Dudley, Vice Chairman; James Bullard; Elizabeth A.
Duke; Sandra Pianalto; Eric S. Rosengren; Daniel K. Tarullo; and Kevin
M. Warsh.
Voting against the policy was Thomas M. Hoenig, who judged that
the economy continues to recover at a moderate pace. Accordingly, he
believed that continuing to express the expectation of exceptionally low
levels of the federal funds rate for an extended period was no longer
warranted and will lead to future imbalances that undermine stable
long-run growth. In addition, given economic and financial conditions,
Mr. Hoenig did not believe that continuing to reinvest principal
payments from its securities holdings was required to support the
Committee’s policy objectives.
Comparison between August and September releases:
»
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Same story. Fake shakeout to get people short and ponzi goes higher rest of day. The Federal Reserve will not cease until a new bubble has been created.
Anyone can see that the Federal Reserves answer to fighting broken bubbles is with a new and larger bubble. They cannot afford not to create a bubble
IYR is leading the way... finally, time to go short.
short WHAT!!!!!
All the original losers who led the crash, and led the bounce. That means the banks and the REITs and the consumer discretionary. SRS and FAZ, etc.
Hmmm...the bots seem unaffected by this news
I don't know .. it just had a hard spike up.
unaffected? They're rocketing it up a notch!
I think that was just the Etrade jockeys waiting until 2:15:00 to put in their buy orders for AAPL
Everytime there is a Fed statement the market goes up until people read it over and realize that they didn't say anything.
Whichever direction the market goes immediately after the release is usually the wrong direction... we'll see if that holds today.
No overt QE2.
what's your number.
and
2nd from http://www.zerohedge.com/article/fed-responds-allegations-pomo-based-stock-market-manipulation
I think the Fed needs to understand what its mandate is better.
it has a "dual mandate" and i think it "understands that perfectly."
For a market that "has QE2 priced in" then there is one direction it should be going...down. I loved the extended paragraph for deflation, but I thought that was no concern.
Is it just me, or did gold just spike?
Regards
I think it's a case of the Dollar dropping.
No, the dollar tanked. Gold just sits there.
or my jaw.
Sure. Heh, though the DXY was down in last night's session too, with Au/Ag taking hits all morning, whereas now...
Moral Question for all:
If the PTB keep doing things that will ultimately ef the middle class, I see this and adjust my portfolio to profit handsomely on an ongoing egregious injustice, should I feel guilty?
FWIW: I spend a portion of my time telling anyone who will listen how to do the same thing.
Regards
There is no moral dilemma in protecting your wealth against the ravages of government and central banking. It is a moral imperative for yourself and your family that you do so.
Thanks GN'n'GL, that reads like a reasonable rule for anyone's conscience.
Regards
Is that a honest question? If you can ask it, you probably know the answer.
"Timshel"
Up $9 in minutes........
Gold spiked dollar tanked
Hi-Ho Silver!
AWWAYYYYYYYYY!
HI - HOe , bitchez
of course i bought my physical gold at the highest yesterday. sure sign when i buy something it is always at it's highest and then goes lower. oh well. dollar cost average into a physical gold position.
Yes. Odd. 1289.40
That is some CRAZY chart action right at the announcement...
It looks like a giant hypodermic needle - full of economic heroin, on the one day, one minute Dow chart.
The economic heroin is 'no QE'? I thought 'certain massive QE' was what the markets were pricing in as a guarantee 700 DOW points ago?
When you tell the junkies that the big shipment will be coming in soon, it gives them something to drool towards. They didn't really say no, just not quite yet.
He better be careful before the junkie grows impatient and throws a tantrum... despite his deep bespoke pockets.
bespoke indeed. and to think they only use drugs "recreationally."
Now you're teasing me. Mayhem my ass. I love fireworks. Still waiting.
'NO QE2', that was priced into far higher stock prices 700 DOW points ago, and the markets go vertical!!
You're not going to get QE2. They can't deliver QE2!
Segate and WDC on the other hand have both spiked.
Dollar is tanking...
You can't handle QE2!
Doesn't the Fed understand that the Decepticrats "need" QE2 in order to stay in power?? Oh, the Humanity!
QE2 will set sail soon in the future. Pushing on a rope leads to further pushing on the rope.
The current federal budget has 5% GDP assumptions. They'll try to get there one way or another instead of being responsible spenders. Keep rearranging those deck chairs boys and girls. Just make sure you get a seat when the music stops.
Amazing reversal in gold / silver just now...
LOL - burnett and gross do the tag team two step for their king. cant afford tax cuts but we can afford huge obama social program after program.
liesman comes right out and says they will debase the dollar before cutting spending.
I don't think it's as much what we can afford or cannot afford but what other countries cannot afford to lose..... being as ball-less as the world leaders are ( I can say that and still have it apply to Merkel, and especially Trichet. Actually the list is long). They know they have a date with the hangman's noose if this comes unravelled on their watch....
Liesman is truth. On the other hand Erin and Bill are...cute.
Hoenig for president.
So now 'no QE' is the GOOD news?
Whasa' matter don' you watch CNBC?
Sure, because it means we will get QE2 anyway, just without all of the worry associated with declaring it reality. Long live the facade!
Happy days are here again!
you will go far young man.
Bloomberg radio is scrambling to explain that we'll probably still get QE2 anyway
Now, now, you know the markets cannot go down with Mrs. Hays on the radio.
what a big heart you have.
You gotta give it a minute. Takes a minute for everyone to get from one side of the boat to the other before they fall off.
LOL
This is playing out just like the last FOMC announcement, which happened after a significant rise in prices, three waves up, just like now. The hangover set in the next morning.
Ok Sheep let me explain it to you so you know how it works:
The glass is always half full and of course the markets could reflect that we are in a false accounting, easy money market that will proceeed to operate as if there is no risk in the market when there is nothing but risk because this a nationalized stock market and there aint nothing free about it aside from the money given to PD's to distort asset prices even though we are in for the worst bear market in financial market history. Their efforts will not succeed..the earnings of companies will continue downward and American citizen anger will increase. There is no volume and this market is an illusion and I assure you that all their attempts to recreate the great shortsqueeze of 2009 will fail.
Good news bad news.......market up!
market MUST spike after ANY announcement, so as to be interpreted as "good".
Wow look at gold and silver! Holy wow!
Fed is out of ammo gang. A useless non-event organization. 50 Bil pomo in a 20 Trillion dollar market.
i like your new look Tim. And "those ain't blanks i'm shootin', girl."
I think youre right virgilcaine theyre out of ammo and trying to cover it up with some vague promise of 'maybe sometime down the road'. Well that road is getting real short, and more trillions of Q/E only assures the total demise of the dollar so where the good news in any of it? None that I can see at all. Underlying it all is still a destroyed US 'economy', if you can call a ridiculous 75% borrow and consume model an economy.
Could it be? The Fed actually wants the Decepticrats tossed out this year?
Guess we'll find out...
The comparison between August and September releases was pure brilliance.
QE2 not if but when.
"consistent with its mandate to promote full employment" is a political statement designed to justify QE2 (the printing of $2T as bill gross suggested).
How printing $2t is going to have any impact on unemployment is for someone far smarter than i to opine on?
not only are they asking "what is God" but "who is he." By all means, "go there. BE THERE."
I loved how Gross said printing money out of thin air wasn't a problem. It was running a huge Federal deficit that had his panties in a bunch. And he did it with a straight face no less.
I want to have his baby. :>)
It appears he is screwing everyone BUT you.
That would make him a "bitch", not a "slut" then!
so obvious. yesterday when obama said absolutely nothing new they cranked the market. today they let it drift in knowing the fed will announce no change.
QE is happening its just more private and they can play the market with rumors, spin and broadcast on the obama business channel
To raise inflation eh????
"As you know, the goal of monetary policy is to foster conditions conducive to sustaining sound, noninflationary economic growth over time and policymakers must make decisions that provide the greatest benefit overall.
Again, thank you for writing.
Sincerely,
JPD
Board Staff"
CNBS in full Goebbels Propoganda Mode
What are they saying? Buy or sell?
10 year treasuries are being sold off now... wow...
If the Fed keeps this up, we'll never hear from Johnny Bravo again.
Well, at least there is a silver lining on that cloud.
How is it that the Fed leaves rates unchanged, and the Treasury yields collapse, crude oil goes down, gold skyrockets, and so do stocks ?
The markets are more confused than Lance Bass was about his sexuality in the late 90s.
Silver looks poised to attack 21.00 again!
FED says things getting weaker. Shorts jump in. Super computers think 15mins and are now grinding them to dust. What a nut house.
This is looking like a market out of control...
DavidC
2 trilllion in qe failed to restart the economy..its over.
zero rates for two yrs, 3% mtgs, no jobs, no credit.
Business Uncertainty forever in Obama and Bernanke from all their 'interventions' and 'programs'.
I like your posts virgilcaine, total sanity.
Dollar is collapsing. A break of 80 DXY could trigger wholesale dumping of Treasuries.
Bring it on! I am tired of waiting already!
Oh ... USZ0 up 1% at 132?
I'm friggin' amazed that these dumbasses are going to sacrifice the treasury market to keep stocks propped up until the elections, but it sure looks like that's what they're doing
I dont think theyll make it till elections, the polls numbers are not rising with rising stocks, people arent as stupid as they wish they were, plnas B and C are being pulled out as we speak I guarantee it.
Huge reversal in gold and silver.
Hard to believe.
What ever Wall St. wants, it gets.
They wanted QE2, Bernanke handed to them on a platter.
enter the Sandman.
1st of all... I wouldn't use that 1 day chart as an example of a HUGE reversal
2nd... He hasn't given them anything, he has only promised to give. They may wake up and realize that. If they do, I hope you are hedged.
3rd.. I didn't junk you. lol
Robo's junks are inversely related to how many pics of hot women he posts.
More hotties, less junkies.
Less hotties, more junkies.
How come this moron gets to post pics?
ps I did junk you.
he B the man
The FED needs to stop communicating or else they will cause a FLASH CRASH! We are so close to the brink now - just opening their big FED mouth causes massive gyrations!
Where is the 'huge move in silver' up .15 cnts?
http://www.kitco.com/images/live/nysilver.gif
I think reality is starting to set in after the speech from the great one. We really are in Kansas, or Detroit, and it was a dream;>}
I wondered why bonds were doing so much better this week when the data really didn't kick things up a notch. Now its clear.
The Fed says in so many words that we are concerned about deflation here and that growth will be too weak. it just doesn't get more dovish than this.
The word on a dovish statement had to already be in the street for bonds to have done so well the last few days....
Ben blew ... his. QE load. lol Mkt knows it as does Virgil. (see tlt)
I don't understand the economy got worse statement. Haven't they read the reports since the ISM? Are they telling us the ISM was a fraud?
And ... we've been out of a recession for almost 15 months now.
Gold and market stride for stride on the 'Ramp to Nowhere'
Oil just spiked! The arabs are laughing now.
10y 2.58, 2y .42
So now any bad report say claims sticking above 500k will be a good thing because qe is right there.
This is getting nuts.
Get ready for hyperinflation.
deflation..straight ahead. Dow resistance at 10800 like brick wall. They giving you a gift to short here.
VC don't cover his short he holds em. patience of a saint.
That really is the contrarian view right now. But you can see it in the HSR, channeling, bollinger band, oscillators, and extreme bullish sentiment : if ever there was a time to start positioning for a reversal, this may be it.
Good man VC. If more do that, there will be no shorts left to squeeze.
CNBC will probably have some half-assed reasons for the spike and fall; like the market initially liked the news, but then upon reflection thought it might mean the economy must be faltering for the FED to mention QE.
The reality is closer to: Players spiked it quick in the hopes the short squeeze could continue by scaring the shorts after the speech.
Clever language. They are gradually raising the "inflation expectation" without committing to anything concrete. Just like James Bullard commented on in his paper regarding 2003-2004 FOMC minutes.
Current 2% Yld on the S&P , LT avg is 5%.. Yld at Mkt Bottoms 8-12%. Mkt is overvalued shall we say.
The emperor just screamed at the top of his lungs, for the 1000th time, "I DO HAVE CLOTHES!"
What a move.
Looks like Ben just gave BOzo the finger!
Time to SELL these suckers!
The change from "will employ its policy tools" to "is prepared to provide additional accommodation if needed" is key.
The Wall Street QE lobby got exactly what it wanted today: a clear statement from the FOMC that it's leaning towards QE2, with no new dissenters.
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