Rob Palombi
Rob Palombi
aware both leaning political public sides spectrum voting
Because of the gridlock, politicians on both sides of the political spectrum will have to be more acutely aware of what the voting public is leaning towards.
adjust allow economy economy-and-economics expanding monetary objective policy prudent speeches stretch
Greenspan's objective is to keep the U.S. economy expanding for as long a stretch as possible. That's why he's being so prudent in his speeches and that's why he'll adjust monetary policy to allow for that.
cuts debt either larger leads left reduction tax
Gridlock leads to more debt reduction than either tax cuts or new spending. Because what we will be left with at the end of the day are larger surpluses.
economy higher justify less market stocks trying valued vulnerable
The market is trying to find an appropriate valuation for those stocks. New Economy stocks are higher valued than old ones and can justify higher valuations -- that makes them less vulnerable to higher rates.
perception
Now I think that perception is much, much different.
appears chance moment officially rate rule scenario
There's still a chance of a rate hike, you can never officially rule that out, but for the moment it appears the worst-case scenario will be an announcement of a tightening bias. I don't see that happening, but that would be the worst-case scenario.
confirm economy evidence markets mind month numbers report
What's important to keep in mind is that we really only have one month of numbers that confirm the economy is slowing. What the markets want to see is more evidence of a slowdown, which is why this report is important.
ease economy expectation fed happen labor market neutral policy prepare seem slow soon switch
What the Fed may do right now is prepare the market for a switch to a tightening policy from a neutral policy, and that may happen as soon as this month. There's always been the expectation that the economy would slow and ease labor market conditions, but that doesn't seem to be happening.