Bernanke Rocks the Markets with Tiny Taper

BERNANKE ROCKS THE MARKETS

Fed Announces Taper to Begin in January

The December FOMC meeting policy announcement has been issued: The Fed has decided to slightly scale back its gargantuan monthly bond-purchases by $10 billion per month. According to the policy announcement: The housing sector remains a problem; Inflation is still too low for the Fed’s taste as the Fed’s inflation target remains 2%, and anything below that number ”could pose risks to economic performance.” For the Fed, everything hinges upon an improved labor market outlook. Bernanke added that current political gridlock over America’s most pressing economic issues is “restraining” economic growth. (Fiscal policy vs. monetary policy ‘unbalanced.’) So what is Bernanke’s solution? It is what it always was: “appropriate policy accommodation.” (Translation: Perpetual easy money policies.)

Bernanke’s Speech in 90 Seconds

>> Read FTMDaily’s Analysis of the Full FOMC Policy Statement <<

• Fed’s “Non-Tightening Taper” Slams Gold Prices. Gold drops below $1,200 for first time since June.
• Another leaked FOMC release? Gold, stocks moved dramatically a full 50 seconds before the FOMC statement was officially released.
• Jerry Robinson on the Fed Taper: “Yesterday’s taper by the Fed took me by surprise. However, if you read the full policy statement closely, you will discover that this taper is utterly meaningless, which partially explains why stocks roared higher immediately after the announcement.”