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FOMC minutes: Taper could happen without labor improvement

  • The Fed could slow its asset purchases even without improvement in labor markets, according to just-released minutes from the FOMC's October 29-30 policy meeting.
  • The committee also discussed actions to signal its intention to keep short-term rates low for a long time even with the taper - particularly a cut in the interest rate paid on excess reserves. Most thought the benefit of such an action to be small, other than as a signal of policy intentions.
Comments (20)
  • AdamDivy
    , contributor
    Comments (411) | Send Message
     
    And there we go! From up a little to down a little.
    20 Nov 2013, 02:17 PM Reply Like
  • buffett222
    , contributor
    Comments (824) | Send Message
     
    Will Fed monitor *actual* employment numbers or fake ones generated by former ACORN employees at Census?
    20 Nov 2013, 06:58 PM Reply Like
  • wapiti
    , contributor
    Comments (703) | Send Message
     
    BS!! QE never ends
    20 Nov 2013, 02:19 PM Reply Like
  • Philip Marlowe
    , contributor
    Comments (974) | Send Message
     
    Would you mind giving us more details as to what exact statement made you reach this conclusion? I am new at the delicate art of reading Fed statements, but from my brief perusal it seems that the opposite is true. More specifically, the Fed said:

     

    "The Committee will closely monitor incoming information on economic and financial developments in coming months and will continue its purchases of Treasury and agency mortgage-backed securities, and employ its other policy tools as appropriate, until the outlook for the labor market has improved substantially in a context of price stability. In judging when to moderate the pace of asset purchases, the Committee will, at its coming meetings, assess whether incoming information continues to support the Committee's expectation of ongoing improvement in labor market conditions and inflation moving back toward its longer-run objective."

     

    Looks to me like they will wait for labor market improvements and higher inflation before they start tapering.
    20 Nov 2013, 02:20 PM Reply Like
  • yliu54
    , contributor
    Comments (170) | Send Message
     
    Well, this is how people like Icahn make money, isn't it.
    20 Nov 2013, 02:52 PM Reply Like
  • wapiti
    , contributor
    Comments (703) | Send Message
     
    Please dont believe all you read or hear from a government employee!! Or politician!!
    20 Nov 2013, 02:30 PM Reply Like
  • Brian58
    , contributor
    Comments (106) | Send Message
     
    until the 10 yr hits 3%, then they'll backpedal.
    20 Nov 2013, 02:32 PM Reply Like
  • JT4041
    , contributor
    Comments (97) | Send Message
     
    Ok, so in case anyone has a doubt that QE is propping up the markets the following is from the FOMC minutes:

     

    "On balance over the intermeeting period, longer-term interest rates declined and equity prices rose, largely in response to expectations for more-accommodative monetary policy."

     

    I rest my case....
    20 Nov 2013, 02:33 PM Reply Like
  • solarcircle
    , contributor
    Comments (290) | Send Message
     
    They won't taper because they can't, they will increase QE. The US is bankrupt and when this finally becomes apparent to the sheeple we will see gold rise.
    20 Nov 2013, 02:33 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4011) | Send Message
     
    My guess as well. Long TLT.
    20 Nov 2013, 08:42 PM Reply Like
  • pollyserial
    , contributor
    Comments (1064) | Send Message
     
    I'm glad you guys know for sure what the market nannies will and won't do in the long run.

     

    Since I really don't, I'm going to just deal with the immediate present and if you look at a GLD/UUP cross it seems reasonably clear where this is headed. For now, at any rate.
    20 Nov 2013, 02:49 PM Reply Like
  • Ron Reed
    , contributor
    Comments (282) | Send Message
     
    While I fear the market reaction to the ending of QE, I certainly hope to see it sooner than later. The resultant devaluation of the dollar will take decades to correct at the current position and the hole gets deeper the longer this continues.

     

    To put it in Greenspan terms QE=oops. (for those that miss it the last part is a bit off color and inaccurate)
    20 Nov 2013, 03:16 PM Reply Like
  • yliu54
    , contributor
    Comments (170) | Send Message
     
    It looks to me the market may gap down tomorrow..
    20 Nov 2013, 03:22 PM Reply Like
  • wizjinx
    , contributor
    Comments (395) | Send Message
     
    Been say'n all along that Yellin isn't a dove or a hawk, she's a pragmatist. She will do what she thinks is right, be it dovish or hawkish.
    20 Nov 2013, 04:02 PM Reply Like
  • caupachow
    , contributor
    Comments (361) | Send Message
     
    Taper does not happen until after mid-tem elections (period)
    20 Nov 2013, 04:16 PM Reply Like
  • Jason Burack
    , contributor
    Comments (1728) | Send Message
     
    I would love to see the Fed try and actually taper. More Fedspeak and open mouth operations. They are most likely bluffing like they usually do.
    20 Nov 2013, 04:28 PM Reply Like
  • ralphrides
    , contributor
    Comments (83) | Send Message
     
    the feds primary mission is to control interest rates which controls the value of the dollar. if they say they will continue to hold interest rates low they may do more than less than more to seesaw it down trying to hold interest rates low.
    20 Nov 2013, 04:56 PM Reply Like
  • dutchdawg
    , contributor
    Comments (4) | Send Message
     
    The Fed's only job seems to be printing play money for the bankers to play with.
    Gold should be at $2500 with the huge Indian importation and lack of value backing for the monthly $85,000,000,000
    prop.
    20 Nov 2013, 08:41 PM Reply Like
  • Kyle Spencer
    , contributor
    Comments (1020) | Send Message
     
    " Nonetheless, some participants noted that, if the Committee were going to contemplate cutting purchases in the future based on criteria other than improvement in the labor market outlook, such as concerns about the efficacy or costs of further asset purchases, it would need to communicate effectively about those other criteria. In those circumstances, it might well be appropriate to offset the effects of reduced purchases by undertaking alternative actions to provide accommodation at the same time."

     

    Translation: We plan to switch QE for extended low forward guidance as soon as we get done running it by the banks to make sure everyone's on board. This isn't news.
    20 Nov 2013, 08:47 PM Reply Like
  • phdinsuntanning
    , contributor
    Comments (1222) | Send Message
     
    for the US private labor market to improve, driving up official "core" inflation in the USA, we might see a strong and increasing GDP and not just inventories up accounted as GDP or nominal revenues driven up by unaccounted inflation. So we might not see this scenario in the next few years and this is the message: no space to pay more interest for the US public debt voluntarily. If the US does not follow the 10 commandments of the Washington Consensus we might see more desperate efforts as the gold inventories sales we see now, maybe negative nominal rates on deposits to keep TBTF banks alive or at least in zombie state and "non conventional" techniques to force savers to put their money in US public debt. Really unfortunate what is going on, no much sound productive economy, just transfers to the State one way or another.
    21 Nov 2013, 07:16 AM Reply Like
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