Here’s
an excerpt from the Fed’s press release:
“Information
received since the Federal Open Market Committee met in November suggests that
the economy has been expanding moderately, notwithstanding some apparent
slowing in global growth. While indicators point to some improvement in overall
labor market conditions, the unemployment rate remains elevated.
Household
spending has continued to advance, but business fixed investment appears to be
increasing less rapidly and the housing sector remains depressed.
Inflation
has moderated since earlier in the year, and longer-term inflation expectations
have remained stable.
The
Committee continues to expect a moderate pace of economic growth over coming
quarters and consequently anticipates that the unemployment rate will decline
only gradually toward levels that the Committee judges to be consistent with
its dual mandate.”
That
actually sounds like decent news (slightly better than last month), but the
Market was up better than ½% when the Federal Reserve made the announcement; it
finished down nearly 1% so it was a big turn-around and would seem to be
directly related to the Fed’s action, or perhaps lack thereof.
Apparently,
many were hoping for some action by the Fed to further stimulate the economy to
stave off perceived recessionary pressures from Europe.
“The
only thing that could make investors happy today is if the Fed stood on the
corner handing out paper money to people passing by,” said Jack Ablin, CIO of
Harris Bank.
The
S&P 500 was down 0.9% to 1226 and the VIX fell 1%.
The
NTSM analysis remains positive with a BUY rating, but a buy at this point just
means NTSM remains positive on the market.
The important buy was on 6 October.
I
bought back into the stock market at S&P 500, 1155 on 7 Oct after the 6 Oct
NTSM buy signal. I remain 100% long in
the long term portfolio (100% stocks in the 401k.). (See the page “How to Use
the NTSM System” – the link is on the right side of this page).
I
am 90% long in the trading portfolio.
Just
a reminder: 100% invested in stocks is way too much for most rational
folks. Don’t do it unless you have a
high tolerance for risk.
