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The Fed

June 20, 2013

So this afternoon the Chairman of the Federal Reserve, Ben Bernanke, held a press conference where he outlined several items: the Fed’s forecast for the economy and GDP growth through 2014, what the Fed was planning regards to continuing its $85 billion of month of bond purchases, and when….if ever, the Fed would consider raising interest rates.

To make a long story short the Fed will be continuing its bond purchases, BUT, indicated that they could start winding down this program during 2013 and have it completely ended by 2014. With regards to interest rates Bernanke indicated that any rate hikes are a long way off.

My sympathies to anyone who was wishing for some higher rates to help juice their savings without having to play the equity markets.

The stock market promptly dropped 200 points at the mention that the Fed might taper off their purchases, but bonds were only slightly changed after increase volatility over the last several weeks.

Here are some links on today’s action:

http://www.cnbc.com/id/100827876

http://www.cnbc.com/id/100829518

http://www.bloomberg.com/news/2013-06-19/treasuries-hold-narrowest-range-in-month-before-bernanke-speaks.html

Any thoughts on this would impact investors and/or companies? I know I have some but I want to discuss!

Sean

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