The Fed’s FOMC (Federal Open Market Committee) released this statement yesterday:
Information received since the Federal Open Market Committee met in August indicates that the pace of recovery in output and employment has slowed in recent months. Household spending is increasing gradually, but remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit. Business spending on equipment and software is rising, though less rapidly than earlier in the year, while investment in nonresidential structures continues to be weak. Employers remain reluctant to add to payrolls. Housing starts are at a depressed level. Bank lending has continued to contract, but at a reduced rate in recent months. The Committee anticipates a gradual return to higher levels of resource utilization in a context of price stability, although the pace of economic recovery is likely to be modest in the near term.
Measures of underlying inflation are currently at levels somewhat below those the Committee judges most consistent, over the longer run, with its mandate to promote maximum employment and price stability. With substantial resource slack continuing to restrain cost pressures and longer-term inflation expectations stable, inflation is likely to remain subdued for some time before rising to levels the Committee considers consistent with its mandate.
The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels for the federal funds rate for an extended period. The Committee also will maintain its existing policy of reinvesting principal payments from its securities holdings.
The Committee will continue to monitor the economic outlook and financial developments and is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; James Bullard; Elizabeth A. Duke; Sandra Pianalto; Eric S. Rosengren; Daniel K. Tarullo; and Kevin M. Warsh.
Voting against the policy was Thomas M. Hoenig, who judged that the economy continues to recover at a moderate pace. Accordingly, he believed that continuing to express the expectation of exceptionally low levels of the federal funds rate for an extended period was no longer warranted and will lead to future imbalances that undermine stable long-run growth. In addition, given economic and financial conditions, Mr. Hoenig did not believe that continuing to reinvest principal payments from its securities holdings was required to support the Committee’s policy objectives.
In short, interest rates will stay low. Harry’s conclusions:
+ Bonds continue to make sense. But they key is to buy opportunistically. Bonds don’t sell on an open market, like stocks. Hence, to find good bonds, you got to hunt.
+ The U.S. dollar will stay weak, which is what the Fed wants — so we can export more. Stocks like Caterpillar (CAT), which export, should do fine.
+ Gold, silver and palladium will do OK.
+ Those companies doing OK will continue to do OK.
+ Somewhere in this arena of ultra-low interest rates, there’s another gigantic boom brewing. I don’t know what it is. It won’t be housing. I’d like to get in on it before it busts five years from now.
Clusterstock issued a release: In Case You Didn’t Realize How Much Gold Investors Love Bernanke
The price of gold spiked dramatically right around 2:15 PM ET today, as the Fed released its latest statement on the strength of the economy.
The FOMC mentioned the word quantitative easing, and left the door open for future asset purchases by the central bank.
The result was a rush out of the dollar, and into a myriad of other assets. But gold’s move was the most dramatic.
This is Clusterstock’s chart:
This is my chart:. It shows what the ETF GLD did.
New York City cranks up its campaign against obesity.
I found this poster in a subway yesterday:
I resisted photographing the fat people riding the subway and ignoring the poster. I went to NYC’s web site www.nyc.gov/health/drinkingfat and found this:
I’ll think of something funny tomorrow. Meantime, I’m sick of my taxes paying for the excessive health needs of fat people.
Harry Newton who wonders why our healthcare is so screwed up and why medicine from Canada costs 60% less (or did for something I checked yesterday) and why you can’t get your medicine shipped from Canada by FedEx? Answer the U.S. Customs seizes medicines for sick Americans and holds them for up to a month. Hence cheap Canadian pharmacies ship only by snail mail. Good riddance to Summers.
Canadian prices negotiate prices – in US drug companies have made sure govt feds cant negotiate pricing, eg, part D legislation.
In NY state can get better pricing than Canada, and same as Medicaid, if you qualify for https://nyprescriptionsaver.fhsc.com/ its NY state govt sponsored a
Please be careful when getting drugs from Canada. Some of the so called Canadian sites are not legitimate or source from the gray market, eg, ship from India or ship diverted expired product. Integrity of drug cant be guaranteed. See for example http://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm216148.htm
Harry- Shame on you. Their was once a guy named Hitler who advocated different treatment for certain folks. If you'd spoken to the possibility of premium discounts for fit folks with health lifestyle choices I'd have remained silent, but you picked on an already persecuted group. Should black pay more because of reckless morals ? Smokers could have been your choice. Drug abusers/alcoholics cost society too much in health care costs. What about the increasing number of Downs syndrome cases ? Survival of the fittest is nice slogan, but picking out who YOU think that might be ??? WOW !If your new daughter-in-law holds baby fat too long will she get a copy of this column ???
Hi Harry,
The reason healthcare in Canada is 60% less is that if you have a funny pain in your head the medical system will schedule an MRI for you in 2012.
Sparks
I'm not talking about healthcase in Canada. I'm talking about drugs — the exact same ones here cost 2 1/2 times as much.
And the drugs are not the same even though the manufacturer is the same. Therefore the “meds” effect is different. The Nexium I bought for years from Canada, for 1/3 the cost in the USA, was a tablet. Worked great for me. When I had to switch to the USA capsule, at twice the price, the results were not as good. Both are made by AstraZeneca. I now take generic Omeprazole in a capsule which costs me $4 for 60 capsules because I have a Medicare Drug Plan and Sams Club gives this “med” a discount. The real “med” cost is still over $1 a capsule. If it were not for the Medicare Drug Plan and Sams Club “generics” I could not afford my “meds”. My brother, now deceased, retired from Civil Service. He got a nice pension and excellent health benefits. He took 16 different pills and went to the doctor at the drop of a hat. All paid for by his Civil Service retirement plan. All paid for by the “little guys” who still have jobs. How much longer can we afford our government? I would rather die as a human bomb in Afghanistan than starve to death in the USA. If I had that choice. Benign Neglect – it is everywhere…
RE: “…healthcare is so screwed up and why medicine from Canada costs 60% less…and why you can’t get your medicine shipped from Canada by FedEx…”
I happily bought my “meds” from Canada until Bush/Cheney killed it in response to the drug company lobby. Larry Summers was nowhere in sight. Since I was poor I only used “snail mail” but Fed Ex was an option until Bush/Cheney killed Canada “meds”. Canada “meds” worked better for me. I still prefer them over US “meds” if I can get them.
I don't know why anyone in this country would complain about anything since they have accepted the “screwed blind” cell phone deal (I am charged for calling and being called) and then the medical over billing and then the ridiculous drug costs.
In 1985 a friend of mine went to Katmandu to hike the Himalayas. They developed amoebic dysentery 2 days up the mountain and had to be “medevac'd” down. They saw a local doctor who prescribed some pills that cost $0.85 cents locally and rest in a local hospice which cost $1 a day. Two days later the fever broke and they flew home, rushed to their local doctor who immediately rushed them to the hospital, ran $485 worth of tests and said, “Just keep taking those pills you bought and you will be OK”. What's wrong with this picture?
I enjoy your column even on the bad days because the good days make up for it. I even find your opinions interesting.
Your form of “noblesse oblige” is very entertaining and informative.
Dear Harry,
F-You. I'm sick of my taxes paying for the excessive health needs of old people.
Hey Fat Guy, getting old is not a choice. Getting fat, for most, is a choice. You make the choice to get fat, you should pay for your own health care. Why should we pay for your bad choices!
Healthy Guy,
Your right, so by your logic, then any choice you make you should pay for.
So then, you decide to run outside everyday for years, should you have to pay cash for any injuries sustained? Or do you think that because you are “healthy”, the rest of us should pitch in?
How about for car accidents, driving is a choice.
What about choices about where you live?
Or are you mostly concerned about the choices people make that you don't like?
Your point about defining “healthy” is interesting. Jim Fixx authored The Complete Book of Running, was a noted fitness guru, member of Mensa, and made a good looking corpse at 52. He was genetically predisposed to heart problems. Perhaps genetic testing should be done on everyone …..gaad, this is a slippery slope…….
Your fatness is a choice. Their oldness is not.
Seems to me that you're falling into the typical “rich guy I'm better than you” mentality. Powerful is in the action, not the person. Who was more powerful at Booth Theater Lincoln or Booth ? If you're confident that your money can provide total security, then piss anyone off you'd like. I'd recommend showing your sunny smile more often than your personal prejudices….
Harry, See below. Also, I wasn't referring to “their” oldness. I was referring to yours! I call it “old people syndrome”, wherein (old) people think they can say anything to anybody, no matter how offensive. This “holier than thou” attitude of yours towards fat people is unbecoming.
Harry,
Have you signed up to work for Cuomo yet? I'm sure you're a big supporter.
No, I haven't and won't. For several reasons: 1. They don't listen to me. 2. NY finances are in such a mess we need a change of administration to have some minor shot at fixing them. 3. I don't think Cuomo will win, anyway.
Wow, are you saying you're thinking of voting for Paladino? What would all you insane liberal friends on the upper sides say about that?
It's a long time between now and November.