| Growth worries held Asian shares lower this morning; however, chances for help from an easing-inclined Fed kept European bourses and US futures in the green so far today. It is, after all, the morning for Fed Chairman Bernanke to make his Jackson Hole speech, at which he has previously announced the central banks’ quantitative easing plans. This time around he may risk forerunning the FOMC policy meeting decision, one that may reflect unusually divided opinions from Fed members. Last month’s FOMC policy meeting minutes were surprisingly dovish; however, since then surprisingly robust economic data has accumulated. Furthermore, Chairman Bernanke is well-versed on the risks of the threatened “fiscal cliff,” as indeed he coined the phrase, and so may be loathe to preempt a later need for the “shock and awe” of large asset purchasing plans. Such uncertainty has kept trading volume exceptionally low this week, although major indices hold not far from their multi-year highs, not yet convinced that Bernanke will not display his firearms, showing the power of Fed monetary easing capability as he details and justifies previous Fed actions and outlines the capability of the central bank to take further actions in the future should the troublesome world economies put the US recovery at risk, or should the soft patch of last Spring return as manufacturing production weakens further, deteriorating confidence erodes consumer spending, or employment data fails to improve. The irony of such a plan, of course, is that Bernanke’s attempt to outline the current economic risks, be they from a hard landing in China, a Greek exit of the eurozone or unsustainably high borrowing costs in Italy and Spain, or weakness within US borders, could itself erode confidence further, undermining strength in equity markets. |
发表于 2012-8-31 10:38
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