After the June 19th press conference when Ben Bernanke suggested the FED might taper the amount of quantitative easing, the markets swooned. Witnessing how deeply addicted these markets are to its easy monetary drug addiction, the FED is now back pedaling.
Below is an article from StreetInsider..com about the Financial Times' interview with Dallas FED President, Richard Fisher:
Market Players Acted Like 'Feral Hogs' on Fed QE News - Fed's Fisher
Dallas Federal Reserve President Richard Fisher, considered a "hawk", likened market participants to "feral hogs" Monday, after bond yields spiked and stocks were slammed in the wake of last week's Fed announcement on the potential end of QE.
In an interview with FT.com, Fisher said: "Markets tend to test things. We haven't forgotten what happened to the Bank of England [on Black Wednesday]. I don't think anyone can break the Fed... But I do believe that big money does organize itself like feral hogs. If they detect a weakness or a bad scent, they'll go after it."
That said, Fisher said the FOMC "fully understood" that there would be a significant market reaction to the Fed Chairman's comments that QE could end by mid-2014.
Meanwhile, NY FED President William C. Dudley was at the Bank for International Settlements 2013
Annual General Meeting, in Basel, June 23rd, back pedaling on the FED Chairman's remarks.
Read his remarks here.
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