Salient to Investors:
Jeffrey Fischer writes:
- Bernanke has been strategically testing the markets to gauge investors’ reactions to tapering – not the first time the Fed has given investors lip-service, and won’t be the last.
- Economic Indicators have improved. The Fed is not concerned much with a decline in equity markets but should be very worried by the sharp rise in T-yields of nearly 1 percent since the beginning of May.
- The bond and currency markets don’t fully buy Bernanke’s 180-degree reversal. A continued rise in equities but no relief in Treasury yields will make the Fed return to serious discussions about tapering.
- Reduce or hedge your exposure to stocks.
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