Late, Fed reporters have become the most important financial journalists on the planet.
When people like WSJ’s Jon “Fedwire” Hilsenrath speak, traders listen and markets move.
For the most part, they have earned this reputation by getting great scoops from Fed insiders or people very close to the Fed.
But today, it’ll be all about questioning.
UBS’s Art Cashin believes it’s on the Fed reporters shoulders to ask the right questions to Chairman Ben Bernanke at today’s post-FOMC press conference. From Cashin:
The Bernanke Press Conference – This could be a very important economic event. Bernanke will have to be very careful and very adroit.
He will, likely, take very great pains to differentiate between tapering and tightening. He probably will take pains to defend the whole QE process (by laying out areas of progress from the very dire straits we were in).
A very, very great deal will depend on how adept the reporters in the room are.
Will they be able to pull out degrees of tapering? Will it be in “baby steps” of reduction (5 billion or 10 billion)? Will it be in both Treasuries and mortgages? In equal amounts?
What about the money that pours in from the existing portfolio (interest and maturity pay-down)? Will that money be poured back into the markets (supplemental QE)? Will they be forced to taper by diminished supply rather than monetary policy? Will they announce that to the public?
Finally, can they pin him down on exactly what targets/guidelines that the FOMC is using to adjust policy? Just how hard are those targets?
And that’s just the antipasto. It could be great if all rise to the occasion.
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