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Markets Await Powell’s Address Tuesday

edited February 7 in Other Investing
Always something, Will be interesting to see if markets zig or zag in response to whatever utterance he shall make. They’ve really been “wired” of late - if you haven’t noticed. Big news today appears to have been interest rates which rose sharply. 10-year Treasury back above 3.6% … Dollar strengthened. Dinged international holdings and some commodities. Little reaction in the precious metals however.

Excerpt from linked story: ”A speech from Powell before the Economic Club of Washington on Tuesday remains top of mind for investors. Markets interpreted a slew of his disinflation comments during last week's post-meeting press conference as dovish and stocks rallied. Many view the appearance as an opportunity for Powell to offer more clarity on where rates are headed, or clarify some comments made after last week's 25 basis point rate hike. ‘I think you will likely see an attempt to perhaps dampen some of the reaction to the statements in the press conference,’ (Sinead Colton Grant, global head of investor solutions at BNY Mellon Wealth Management) said.”



  • .....So THAT'S what happened. Ya, my bonds got their clocks cleaned. I'm down to 59% stocks, 33 bonds, 7 cash. But that's misleading because I'm using the sweep account as a savings account for a particular thing. It will be empty, almost, again, soon enough.
  • I have also read that Powell was added LATE to the agenda of Economic Club in DC, and the purpose is to CORRCT some impressions - intended or unintended - at the last FOMC presser. So, the above + his WRONG comment about financial conditions that he said remain tough, but have moderated in the last few months.
  • edited February 8
    Place your bets ! Will Powell's luncheon address or Biden's SOTU move the markets more ?
    ADDED :
    Appears Powell won the bet, as Futures Wed. morning are in the RED . I guess we should give Mr Market more time & see how the day pans out .
  • Also, when you hear Fed's open-mouths in the news, keep in mind that Bostic (Atlanta Fed) is NOT a voting member of FOMC in 2023.
    Voting Fed Prez in 2023 are Goolsbee (Chicago), Harker (Philly), Kashkari (Minneapolis), Logan (Dallas). There is an annual rotation.
    Williams (NY) is FOMC VC & permanent voting member. Don't confuse this with Brainard who is the Fed VC.
    Of course 7 Governors always vote (these are at full strength now).
  • edited February 7
    David Rubenstein (Bloomberg) preempted Powell’s speech by interviewing Powell in front of an audience at 12:45. Really pressed him on a number of issues. Especially the 2% inflation target. Near as I can recall, Powell said it was a firm target. Hence, I’m not sure why the markets seemed to react positively (initially, anyway).

    FWIW - the sources I follow - even the typically bearish ones - seem to be growing more positive on the markets, including gold. Seems to me that there was more negativity 3-6 months ago when valuations were 10-20% lower. Heck, even the IMF recently upgraded / improved its global outlook. Go figure.

    (Not intended as investment advice)

    Video of interview:

  • edited February 7
    Today is a prime example of why its best not to watch the stock market daily, let alone intra-day. It's simply not healthy.

    Its this really BAD form of entertainment of which we cannot get enough, especially when over-invested.
  • edited February 7
    JD_co said:

    Today is a prime example of why its best not to watch the stock market daily, let alone intra-day. It's simply not healthy.

    Thanks. It certainly wasn’t my intent to make people sick with the post or the Rubenstein / Powell summary. Will try to be more judicious in what I say and post. Personally - never felt better.
  • edited February 7
    @hank et al David Rubenstein is an excellent interviewer, if you've had a chance to watch his shows over the years; and he is well versed in the investment world from many years in that world. He's doing a chit-chat with Tom Keene just now (2:08pm) about the Powell interview.
  • I felt that his comments were interesting and informative. One specific bone to pick. Some folks say why use a handful of words when one will do...well, as Powell said today when asked about his use of the term "disinflation"...he says that means he sees a lessening of inflation. Sounds encouraging.
  • edited February 7
    In support of @JD_co I do think it’s “unhealthy” for your investments to be constantly tinkering or to buy / sell anything based on something you read or heard recently or some “hunch” gleaned from the media talking heads. Additionally, not everyone enjoys the daily give-and-take (CNBC, Bloomberg, WSJ or whatever). Perhaps time better devoted to other pursuits. I’ve argued with others in the past that no harm derives from simply absorbing information, however trivial it may seem. The self-inflicted harm emanates from actions taken in response to what mounts to minutia.

    Jerome Powell is one of the most influential persons in the world of finance. His words move markets both at home and abroad and his actions affect the wellbeing of millions of Americans. Witness the home affordability crisis facing buyers today after the large spike in rates induced by the Powell led Federal Reserve. If you’re thinking of buying or selling a home, Powell’s views matter.

    David Rubenstein probably isn’t that well known. As @catch22 noted, Rubenstein is an excellent interviewer. He is also a highly experienced and influential investor in his own right.
  • Be aware that Powell used the term disinflation for the first time (for him) at the post-FOMC presser. It created some confusion in the markets and today he clarified that it also means lessening of inflation. This is what happens when people watch every word from the Fed/FOMC. It may also mean that anxiety level in the market is high and almost anything may be misinterpreted.
  • Inflation = rising prices, disinflation = inflation going down, deflation = prices declining.
  • Gary1952 said:

    Inflation = rising prices, disinflation = inflation going down, deflation = prices declining.

    Simple and clear. :)

    Yes, D. Rubenstein is smart and is a good interviewer, indeed. I don't often catch him, but I do often see excerpts. (When the channel runs out of silly commercials to show you, they fill-in the gap by showing the viewer a self-promoting bit.) I can't get CNBC, but I can get Bloomberg, and put it on whenever I'm sitting down to a meal or a snack. And Rubenstein is not without a sense of humor. Refreshing.

    This is one investor who likes to keep abreast of everything, but I act to make changes quite seldom.

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