Do you know what "FOMC" stands for? And what do they do?

 Market Talk

Yesterday, "the FOMC" had their meeting.

The Federal Open Market Committee (FOMC) consists of twelve members--the seven members of the Board of Governors of the Federal Reserve System; the president of the Federal Reserve Bank of New York; and four of the remaining eleven Reserve Bank presidents, who serve one-year terms on a rotating basis.

 

By law, the FOMC must meet at least four times a year; in recent years, it has met eight times a year. The meetings, held in Washington, D.C., are attended by the members of the Fed's Board of Governors (Board of Governors), the presidents of the 12 Federal Reserve Banks, and some senior Federal Reserve staff members

 

 So the meeting yesterday, in a nutshell, resulted in the notion that the Fed plans to act over the course of the near future as though inflation is not as much of a concern as re- starting the economy so that the job market can improve from pandemic levels. They "try" to manage inflation by the setting of interest rates that banks lend money.  The theory is that it controls growth and higher rates can slow down an expanding economy and thereby reduce inflation.  sheesh!   talk about a house of card theory! But as an example, if rising rates make it harder for people to buy cars or homes, it slows down auto buying and home buying and those sectors may slow down. For now, the Feds are saying - hey market - don't worry about interest rates rising.

So one thing that the Fed impacts with calls on rates is the stock market.  This is because "the market" is always looking 6 months ahead at trends. If the perception is that the economy will slow or speed up, money fund managers shift investment into different sectors anticipating the change.

The market responded that growth is back on.  Meanwhile, many do not believe that inflation will be so easy to manage with the government's progressive agenda and bailouts to the states and cities that supported the socialist democrat agenda.

 

Stock Talk

I will leave it up to the reader to check some stocks of interest out and perform their own due diligence.

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ALL in my humble opinion, scroll down and read more.. 

This site does NOT make Buy / Sell recommendations.
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