Friends
Plenty of theatre today, as we got to watch the “dynamic” Janet Yellen do her job interview for the Senate Banking Committee, and then watch President Obama get shelled at his press conference on Obamacare. First Ms. Yellen made it perfectly clear that she will continue the accommodative policies of the Bernanke led Fed, both believing that the Fed has been successful in affecting positive change, and also determined to keep the punch bowl filled as long as “needed”. Traders continued to add to stock positions believing that an accommodating Fed will continue to buoy stock prices.
For the day, the Dow Jones Industrial Average was up 54 points to close at 15,876. The S&P 500 was up 8 to finish the day at 1790. Gold was up $18 to trade at $1287 per ounce, while oil was down $.07 to trade at $93.81 per barrel WTI. With the S&P within shouting distance of 1800, the bulls have the technical data and momentum on their side.
As for the President and Obamacare, I don’t think it could get much worse for him. He looks like he’s had a few sleepless nights lately. Unfortunately, we are seeing the inefficiency and inadequacy of a start-up government program in action. Perhaps the intentions were good (but I bet many of you would debate that), but it’s hard to argue with the early returns. Yikes!
As for the markets, traders taking their cue from Ms. Yellen are expecting more of the same, as rates begin to slip back down again, and stock prices continue to rise. Ms. Yellen claimed that she sees no bubbles forming. Now, the Fed’s bubble detecting apparatus hasn’t been in good working order for some time, but we’ll take her at her word. It will be interesting to see how Fed policy deals with improving economic data points. Indeed, they have claimed to be data dependent. We’ll be watching.
Have a nice evening everyone.
