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FBN's Fed panel Michael Cox, Doug Cote, Sharon Lee Stark, Phil Flynn and Nicole Petallides weigh in on the FOMC’s statement on the economy.
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Michael Cox the first shot at translating rich -- you know reading of the Fed speak -- there.
Eleven to one vote that he just talked about with -- -- against but again no new.
Policy steps Michael but is there anything that you pick out there that that stood out to you.
You know there's a bad -- a bunch of Smart guys who imitates some really good economists from what they're telling you look at it this is nothing we can do about this.
That right now the problem is not this -- is -- good anniversary of the problem with interest rates is that people just don't wanna borrow from running a business today.
What's holding me from moving forward is not the fact that -- borrowing costs are high the Fed has done all the -- to make those very low for.
I don't wanna borrow because I don't wanna put my Ford out put out there in these tepid waters because I don't know what's gonna happen.
With the economic policy I don't know what doctor how are not -- the government mandated health care.
Is the largest tax and it is now declared a taxable foisted upon the American employer.
Instead of hiring people to going -- and putting all kinds of machinery and equipment and and sending jobs abroad which any rational person would do.
So I mean we've we've got -- all back and -- later this blaze at the -- of congress and the presidency.
Yeah well I think we -- knew they were gonna punted to congress -- called -- down 45 points right now traders obviously not happy with the language that you know what.
It'll come as needed but not right now.
Well that's right and you know the words that are we're sad are now are really not great at all when you started to hear about -- slow employment.
Household spending is rising slower than it had been also housing.
Remains depressed sending -- know these -- the facts that's the Fed is reiterating.
And that's not a good time to think that really in this market to -- the dollar as -- here with a dollar was virtually flat the dollar to opt.
The market sold off dramatically here so when you look at -- -- -- chart it's very telling in house reacts to.
The Fed's statement.
Our -- Richardson jump in with that statement I was gonna go to Phil Flynn on the trading floor in Chicago and ask how market would react.
To a Federal Reserve is Michael Cox just put it a moment ago who bit which is basically saying hey there's nothing we can do about this that was that was Michael's words -- the exact Federal Reserve yeah statement but what about.
That situation -- well.
You know it's in the market active like the Fed actually -- something didn't -- bank.
And that's what's amazing about the -- down here right now I think the traders reacted when the Fed said that the economy decelerated.
No big surprise but they acted on that.
Why they believe that maybe the Fed was gonna do something later even though they didn't say they want it.
Or maybe they're -- bring on the ECB if you look at the move in the dollar.
Tracy when -- was incredible.
You look at gold and killed -- -- -- down like seven dollars on gold.
Before the announcement is -- they said these -- -- -- on the screen.
What a dropped seven bond like that the same thing about now we're down eighteen dollars engulf the price of oil with some of the box seven leave some -- They went down they were only up thirty cents or -- pony to right now.
So it seems like the market believed that QE2 is gonna happen at least after the reactor.
Regardless of what the Fed -- for maybe they just believe that now we're through that bad.
Bonuses IP TV I think that statement with the Fed would like that -- them like fifteen Europe back.
And congress to act before they have to -- Right -- -- you know -- -- grade point they can't say anything we didn't know and yet the market for some reason is reacting to this -- sometimes I guess the truth hurts on occasion.
But -- your point earlier this market has gone up regardless of all the bad news.
I -- -- -- DS and 500 up 10% a lot of people still missing this.
Do you still recommend they get -- and now.
Absolutely and by the way.
I congratulate the Fed Bernanke.
He had a lot of risk on the losing side I call this a win win win.
He finessed this not a pressures on the ECB tomorrow as time congress for the fiscal -- yes she should stay invested broadly globally diversified.
This says this market is going to strengthen and I I like the news on the dollar.
And gold as well -- any -- that -- -- mean but before I get charity not yet been and allow what do you mean finessed it that he did it right and took the everybody else saying today didn't really do anything quote unquote what do you mean you did -- -- that that it.
Sometimes no action is the right now okay and he did no action that was absolutely the right action to do nothing.
That it is kind of are up -- then chair until tomorrow.
Obviously your -- Central Bank a lot -- Give putting pressure on nov DEC -- quote unquote do something as opposed to do nothing as we just talked about Federal Reserve is that.
What do we what do we look for them tomorrow morning.
I think you should look for the ECB to at least.
Reinstate the securities markets -- where they'll buy dead and some of the sovereign specifically Italy and Spain.
And I don't think the Fed is thorough -- bit disappointed that they didn't do anything this time.
But even though they now its effect that the economy is decelerating and I think the data coming.
I over the next month he's going to cause them to act a long way it.
The remembers -- and the ECB and also the other central banks around the world so I don't think we've seen the end of the -- I -- the fiscal side of it really needs to getting gear.
But just because they're not doing anything doesn't mean the Fed should not do any thing.
