“When investors come to fear the next Fed-talk, that’s when markets will change direction,” he said. “Now they bid up risk in advance on confidence – and afterwards on reassurance – that ZIRP will continue. But eventually they’ll focus on the start and pace of tightening. Fed-speak will assume an aura of bad news.”
And on Wednesday, there was some Fed-speak. As the minutes from the Fed’s July 29-30 policy-setting meeting were published, investors hit the sell button, just a smidgen, then changed their minds, but not much. The Dow and S&P 500 ended the day up, the Nasdaq slipped. The reaction seemed uncertain, jittery, frazzled, but finally unconcerned.
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