What Scared Everybody About the Fed’s Statement

Sep 22, 2011
J. Webster
Comments Off on What Scared Everybody About the Fed’s Statement

Yesterday, after the fed’s statement, all the initial talk was about Operation Twist, and exactly what it was going to do. But what scared traders, and what seemed to be the most salient point about the Ben Bernanke and the Federal Reserve’s statement, was a single word they used: significant.

In federal reserve speak, that was equivalent to saying the economy is in the sh#@ house. Or, the economy is one big pile of dog sh#@. Or, it was like saying the U.S. economy is going to be very fuc##@ for a very long time.

And strategic investor Dennis Gartman is also cautious. He think the Fed was trying to tell investors in Wednesday’s statement that the economy is heading into recession by the language they used in the following statement.

”Moreover, there are significant downside risks to the economic outlook, including strains in global financial markets,”.

And he’s not alone.

“The Fed scared the daylights out of people with the term ‘significant,'” adds Jack de Gan, chief investment officer at Harbor Advisory Corp in a Reuters interview. “I was surprised … they’re very careful about the adjectives that they pick and that was a very, very strong one.”

Source: CNBC

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