The moment of truth has arrived..

Jay Soloff

Argonath Financial

The moment of truth has arrived... and the Fed has decided to begin tapering in January. The central bank is cutting $5 billion off its Treasuries purchases and $5 billion off its MBS purchases to reduce the total amount of bond purchases to $75 billion a month. For the economy, those reductions should amount to essentially nothing. It's just a way for the Fed to step into its reductions without creating havoc in the financial markets. The Fed's overall policy is still highly accommodative. In fact, the biggest news from today's Fed statement is that the committee plans to keep the Fed Funds Rate at zero even after unemployment hits 6.5%. That's a major change of policy and should also be bullish for equities. Basically, inflation is still running below target levels (2%) and we won't see a major policy shift until that changes.

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Jay Soloff
Jay Soloff
Research Analyst
Argonath Financial

I'm an investments analyst for a US-based independent investment research firm. My focus is on economics, options, and all types of stocks, but especially tech, Internet, and renewable energy companies. I have experience as a options market...


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