Posted on 08/09/2011 11:39:44 AM PDT by markomalley
For immediate release
Information received since the Federal Open Market Committee met in June indicates that economic growth so far this year has been considerably slower than the Committee had expected. Indicators suggest a deterioration in overall labor market conditions in recent months, and the unemployment rate has moved up. Household spending has flattened out, investment in nonresidential structures is still weak, and the housing sector remains depressed. However, business investment in equipment and software continues to expand. Temporary factors, including the damping effect of higher food and energy prices on consumer purchasing power and spending as well as supply chain disruptions associated with the tragic events in Japan, appear to account for only some of the recent weakness in economic activity. Inflation picked up earlier in the year, mainly reflecting higher prices for some commodities and imported goods, as well as the supply chain disruptions. More recently, inflation has moderated as prices of energy and some commodities have declined from their earlier peaks. Longer-term inflation expectations have remained stable.
Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee now expects a somewhat slower pace of recovery over coming quarters than it did at the time of the previous meeting and anticipates that the unemployment rate will decline only gradually toward levels that the Committee judges to be consistent with its dual mandate. Moreover, downside risks to the economic outlook have increased. The Committee also anticipates that inflation will settle, over coming quarters, at levels at or below those consistent with the Committee's dual mandate as the effects of past energy and other commodity price increases dissipate further. However, the Committee will continue to pay close attention to the evolution of inflation and inflation expectations.
To promote the ongoing economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate, the Committee decided today to keep the target range for the federal funds rate at 0 to 1/4 percent. The Committee currently anticipates that economic conditions--including low rates of resource utilization and a subdued outlook for inflation over the medium run--are likely to warrant exceptionally low levels for the federal funds rate at least through mid-2013. The Committee also will maintain its existing policy of reinvesting principal payments from its securities holdings. The Committee will regularly review the size and composition of its securities holdings and is prepared to adjust those holdings as appropriate.
The Committee discussed the range of policy tools available to promote a stronger economic recovery in a context of price stability. It will continue to assess the economic outlook in light of incoming information and is prepared to employ these tools as appropriate.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; Elizabeth A. Duke; Charles L. Evans; Sarah Bloom Raskin; Daniel K. Tarullo; and Janet L. Yellen.
Voting against the action were: Richard W. Fisher, Narayana Kocherlakota, and Charles I. Plosser, who would have preferred to continue to describe economic conditions as likely to warrant exceptionally low levels for the federal funds rate for an extended period.
Even 363 down today means over 1000 down in 36 hours.
The FED basically said TWO THINGS TODAY:
1) The Economy WILL NOT IMPROVE as long as Obam,a remains in office.
2) Who the hell is JOHN GALT, and what happened to all the productive people?
Somebody is propping it up.
Huge jump just occurred.
This is the part of the ride where I throw my hands up and yell “WHEEEEEEEEEEE!!”, right?
}:-)4
Automated buy triggers maybe?
}:-)4
SUMMER OF WRECKOVERY!!
That's a good one. Did you make that up?
Some investors that are panicked, the non-attentive passive investors, doing what has previously preserves their principle. Inflation will eclipse the static values over time.
“My fellow Americans, just a quick message since I’m coming up to the tee for hole #4. I’d like to let you know that the Federal Open Market Committee says, “business investment in equipment and software continues to expand.”
This is a sure sign that the economy is roaring ahead and becoming more robust each day! This is a great sign that my plan, the stimulus or whatever we called it, it is working. FORE! Hook! Hook! Oh, damn! Cut that emeffing tree down right now!! And bring me a slice of the trunk.”
You've got to admit it sounds better than 'Five Year Plan'.
We're not working extra hours at the office, we're spending them building gardens, orchards and guest quarters at home.
You think? lol!
Mike
Why is the market so fiercely volatile now? Some are dumping others buying...so when will it level out do you think?
Does that mean that the Fed will purchase more treasuries? (print money)
Mike
The Committee also will maintain its existing policy of reinvesting principal payments from its securities holdings...
...this afternoon.
Is this FedSpeak for, "we'll crank up the printing presses into high gear as soon as we can find a way to mask it and call it something besides QE3."?
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