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LPL Financial fixed-income investment strategist Anthony Valeri, Fulcrum Securities chief investment strategist Rob Morgan and former Fed economist St...
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And we now want to bring back in our all star panel that was a lot and information -- you tied jazz but.
JC let me give me a chance to -- in so slight downgrade to economic growth not a huge surprise considering the -- so well.
I'm not the sharpest tool in the shed but how do you aren't GDP and great and then -- decreasing unemployment rate at same time and I am saying -- -- -- I -- -- -- grad school.
The other thing that throws me is it that way in apparently they don't -- milk and eggs and -- fiscal policy restrictive -- and I thought really interesting because.
Fiscal policy is like the one nugget they can't control right -- they cannot control what -- had congress doesn't the decisions -- -- -- no matter how much.
Uncle Ben throws out there it can still totally be you round by our congressional leaders and in this.
Bernanke continues to kick it back to congress and say get your act together yep yep and -- -- not rob Bartlett.
Let me bring you back in and -- -- trying to solve that act conundrum for us they lowered their GDP growth forecast although just moderately from two point 7% to two point 6% for 2013.
3.2 percent for 2014 and fifteen but they significantly downgraded where they've -- plan that was going to be seven point 4% 2013.
How do you lower unemployment and just cut.
There -- about that you looking at the math that that and I and I -- And I bring in many economists on this do if I'm a market watcher but perhaps perhaps it's related to trade in emerging markets group parent perhaps are somethings something -- people that -- had a labor force their people -- -- -- -- yeah.
This is the absolutely Stephen you want to -- what do you think.
I think -- just making minor adjustments to their forecasts I mean the unemployment rate moves around in a way over the past several months that they might not have anticipated fully so that just trying to.
To really true everything up -- still forecast of moderate growth and very slow declines in unemployment.
All right -- -- -- still happy with -- to do with these -- and I think Jeff what are what's the reaction there and Amy.
Yeah we're just -- the Fed fund futures pit and we've seen a slight.
A slight movement fed fund futures and actually Phil's been check -- -- this is zero dollars over here behind us they feel you've been watching it I I just want to get your numbers.
-- been watching and teachers really didn't one I think we get the focus on its December of 2014.
You know they were the only won the when he and the quarter point to the Fed fund futures is -- actually -- -- and even the slightest possibility.
Of an interest rate increase -- opinion -- -- you do the math some people said it would be at 37% chance.
Who really from a futures -- standpoint that's when they were pricing in a full begin a basis point move.
You know -- -- -- like I have to take after the announcement just a little bit closer but still a little bit closer Jeff and I'll tell you what the market.
You know he's embraced seeing this new transparent that we know almost to -- minute what they're doing what these guys you know can't make money trade groups.
-- veteran offense better telegraph -- -- it that they were right on the number and it's not gonna change a lesser some big Newser.
You know some at a later news from that the the end announcement today obviously -- these guys make money when there is movement in this market and -- There's just no movement Obama -- our futures it's not we can't our money out way.
I'm -- changing but let.
Anthony Larry because of course he's a fixed income investment strategist who does this change.
Any of your strategy be the forecast -- you've heard anything you heard so far does it change your strategy.
No I did I don't think it does I think that this is still longer term -- positive for for risk assets and I think Bernanke set himself up to keep.
Stimulus in place him in the downgrading of the GDP was -- quite frankly not surprising given that they're so far above the consensus.
Will probably hear him maybe -- -- the decline in the unemployment rate in the press conference saying that that might be a labor force participation issue.
The really this I think sets him up for more stimulus especially the decline in inflation.
So expect bond purchases again through the rest of the year that's that's a positive riskier segments of the market for stocks saw return even though -- had the strong start.
In the bond market favors corporate debt high yield.
And preferred securities more economically sensitive sector so.
This is more of the same that we've gotten from Ben Bernanke still very -- -- I think we'll hear more of that in the press conference -- last word.
In arguments and the big question is what happens in the market once the Fed starts a hike rates well yet.
-- last two rallies a -- big rallies the market actually did pretty good to rally from ninety to 2000.
The first time the Fed hike interest rates and market pull back 6%.
Proceeded to turn around a rally for another -- one months in 220%.
From there.
The last rally 2002 to 2007.
After they -- -- the first time we pull back 7% turnaround rally for another.
Forty months in another 44% boost so people who think it's automatically over what's offense starts a hike rates may even mean for surprise.
Well I have some history to have that I have to spend as I -- -- and you know eventually good news for the economy becomes good news for stock at some quite good.
-- -- -- -- and how we got a bizarre world.
I've got that take you so much guys rob Morgan welcome securities former fed economist Stephen opener.
Anthony Blair at LP a financial -- deaf child Tracy -- sticker on please Peter Barnes.
-- -- take your -- the news conference will be checking back -- throughout the afternoon once again many.
