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Good morning. The key to today and perhaps the next several days is what Ben Bernanke's bunch will decide to do, if anything, at the conclusion of this month's FOMC meeting today at 12:30 pm eastern time. Due to the fact that the current Fed Funds target is 0% to 0.25%, it is a safe bet that interest rates will be left unchanged. And it is also highly likely that the FOMC statement will acknowledge the recent weakness seen in economies around the world. But after that, and let's be honest here, nobody really has any idea what else the Fed is going to say and or do.

However, there are all sorts of folks that run around espousing, with absolute certainty by the way, that they know what a group of central bankers is going to do about a problem that has never been seen before. Goldman Sachs (GS) is one such entity as the embattled investment bank issued a note to clients this week stating that the Fed will embark on a new version of QE "flow." However, while GS does employ some of the brightest financial minds in the country and they would appear to have an "in" so to speak on Capitol Hill, it is worth noting that Goldman's been singing the same song about more QE since November.

Then there's JPMorgan (JPM). While I would at least listen to what they have to say, the bank seems to be tied up at the moment as Jamie Dimon has been spending some quality time with his new friends in Congress. On that note, the line of the day came from Maxine Waters, who apparently asked Mr. Dimon (in an accusatory fashion, of course), "Did the drop in the price of your stock impact your shareholders?" Ya think? (And the response of the day goes to Jeff Macke who responded on Twitter with, "If you voted for Maxine Waters, go stand in the corner!")

But I digress (shocking, I know). The stock market, if it can actually be referred to as an entity, also appears to "know" what Gentle Ben is going to do. And stocks would appear to have company as the dollar also seems to be "saying" that some additional monetary stimulus is on its way. But, we should point out that the folks in the bond market, who are known to be a tad less emotional than their stock market compatriots are not so sure what to expect from the man who once said he would drop cash from a helicopter in order to keep the U.S. out of a deflationary spiral.

Then again, the stock market's record on predictions isn't always spot on. Remember that stocks have predicted something like 9 of the last 6 recessions and have had a false start or two lately on some economic predictions (the big rally in front of China's GDP report comes to mind).

But in keeping with the spirit of this morning's meandering market missive, I've got to admit that I have no idea what the FOMC is going to say and/or do and I take no shame in making such a statement. You see, knowing what you don't know is half the battle in this game. And I'll go you one better this morning by admitting that even if my crystal ball was functioning properly and I did know what Bernanke's boys were going to say, I am not sure I could tell you what the market's reaction would be.

Some will argue that the recent 800 point rally on the Dow has already discounted the Fed taking action and thus a "buy the rumor, sell the news" trade may already be queued up. Others will suggest that more Fed stimulus will lead to the "risk on" trade that David Tepper made famous in 2010, which would be expected to take stocks to new highs for the year, beat down the dollar, and pump up the value of things like oil, grains, steel, coal, and of course, gold. And still others will suggest that any rally in the stock market in response to more easing will be short lived due to the fact that, well, QE hasn't really worked very well in terms of the Fed's dual mandate (stable prices and full employment).

So, let's be honest here, with such an important event in front of us today (to say nothing of the political negotiations in Greece slated to come to an end Wednesday or the idea that there is purportedly something big brewing across the pond) it is tough to know what to do. Yet it is also tough to react to the event as Fed announcements are notorious for creating big volatility in both directions. So what is a prudent investor to do?

As long time readers know, I'm not big on predictions (unless you are going to make them early and often, that is). As such, I don't have a bullet-proof strategy for today and I won't pretend that I do. I will however, tell you that I will stick to my risk management systems, which at the present time are on buy signals. So, since I'm long in my actively managed accounts right now, my fingers are crossed. But to be honest, I'm not sure what I'm rooting for. Here we go ...

Turning to this morning ... News that political leaders in Greece have successfully formed a government has given the futures in the U.S. a modest boost. However, the key to the session remains what the Fed will do and say at 12:30 eastern.

On the Economic front ... There are no economic releases prior to the FOMC Rate Announcment scheduled for 12:30 pm eastern.
Thought for the day ... A volunteer is worth twenty pressed men - English Proverb
Pre-Game Indicators
Here are the Pre-Market indicators we review each morning before the opening bell ...
  • Major Foreign Markets:
    • Australia: +0.23%
    • Shanghai: -0.35%
    • Hong Kong: +0.53%
    • Japan: +1.11%
    • France: -0.11%
    • Germany: +0.25%
    • Italy: +1.45%
    • Spain: +0.49%
    • London: +0.52%
  • Crude Oil Futures: +$0.17 to $84.20
  • Gold: -$14.20 to $1609.00
  • Dollar: higher against the yen, lower vs. euro and pound
  • 10-Year Bond Yield: Currently trading at 1.642%
  • Stock Futures Ahead of Open in U.S. (relative to fair value):
    • S&P 500: +1.17
    • Dow Jones Industrial Average: +9
    • NASDAQ Composite: +3.57
Positions in stocks mentioned: SPY, IEI
Source: Daily State Of The Markets: Let's Be Honest Here ...