On Wednesday July 31, 2019 the FOMC (Federal Open Market Committee) led by Jerome Powell and attended by our own Dallas based Robert Kaplan, did something they have not done in over 10 years…. LOWER RATES.
On Wednesday at 9:23 AM, just over an hour before the regularly scheduled 10:30 am post was to go — a quick review of the 10:30 post led to an update from the Ipad which had saved data on the device and then updated it when the review occurred… and some how sent the following title …
If you saw it and wondered… now you know – for the record first time in almost 2000 posts now! Of course some have gone off at 10:30 pm rather than am and earlier than planned – but this was the first totally unplanned post – sorry for the confusion, if it caused any! I like to think of it as authenticity 😀
FOMC in View
Next week the FOMC (Federal Open Market Committee) let by Jerome Powell and attended by our on local Dallas President, Robert Kaplan – (our newly admired local president) better lower rates!
It’s hard to feel like they must lower rates as the global economy is slowing but not falling off a cliff …. Their (FOMC) public rhetoric has led Market Participants to be almost certain they are going to lower. If they don’t lower rates – disappointment!
Should be interesting!
Have a GREAT Friday and a Super Weekend – talk to you next week!
The Perot Museum Thursday November 14th, 2019 from 6:30 to 9 PM for a fun filled event!
We like to articulate our thoughts and review on a Monthly basis our Financial Planning Tips, Capital Markets and current events!
Financial Planning Tip (s) –
Password Safe Keeping Idea and 1 Minute Video
After attending a conference that mentioned multiple times the troubles associated with Digital Assets AKA your passwords, a brain storming session led to this terrific post about how to safeguard your password, upload to the private portion of your Vault, password your document, and then refresh occasionally. A possible Excel file with links that is itself heavily/strong password protected!
Here in the Preview meeting post and with Robert Kaplan audio (below) explaining how he and the FOMC (Federal Open Market Committee) go about determining what to do with rates, we also mentioned many expecting a LOWERING of rates….just a few quarters ago, unthinkable.
Here is the Kaplan Audio:
Post meeting Market Participants…
Fast forward to our Post Meeting Post here , and while we did not get a lowering of rates, the great consensus feel like the following quote signaled they are coming all garnered from this statement and supported by the lowered GDP expectations – chart below:
“…. but uncertainties about this outlook have increased…”
For a sleepy time of the year, there is a lot going on – That’s what we are here for!
Have a Great Day – Talk to you at the end of July!
Ok…so the Social Security event forced us to pull together new audio equipment – we never knew how quickly we would utilize these new tools for events such as what follows – We hope you enjoy these pertinent comments directly from the horses mouth!
Unthinkable just a few quarters ago…. Market Participants are thinking there may be a FOMC (Federal Open Market Committee) LOWERING of rates – yep lowering!
This week the FOMC will announce their decision, based on many factors as you will hear from the attached audio – what makes this weeks meeting special is the slight expectation of a lowering of rates and this meeting includes the FOMC estimates of the economy and an interview with chief Jerome Powell post announcement –
Now – what they are looking at to make the decision!
At our recent CFA (Chartered Financial Analyst) sponsored event, we were fortunate enough to have an hour with Robert Kaplan, Dallas Federal Reserve President. We were also fortunate enough to get audio of the event…
What the Fed Watches to make rate decisions
According to Robert Kaplan, Audio below, he along with his fellow FOMC chiefs watch the following, just to name a few items:
Cyclical Factors – Short Term Indicators – Less important to Kaplan – I.e. CPI, Earnings, Interest Rates, Employment rates – basically all the items we read on a daily basis or are bombarded with in “Breaking News! Like format – Interestingly and very correctly from our perch, Kaplan is not a big advocate of placing much weight on these factors – see next as he mostly ignores the short term noise – Wisely in our opinion – see audio below
Structural Factors – Longer Term Trends – MORE important to Kaplan and becoming more important to the entire FOMC board due to his repeated review – I.e. Population growth/demographics, Government Debt, Corporate Debt, TECHNOLOGY INNOVATION (huge importance), World Growth – Again, totally agree – see audio below
Individual Company Response – Kaplan talks to over 30 large and small company CEO’s monthly along with continued in- person visits with companies to help determine, just what the economy is doing along with longer term Structural disrupting factors – see audio below
Group Input – With multiple chiefs from a dozen districts bringing their collective input to the table, a theme hopefully develops!
Here is the Audio in different formats for different devices – with three different types we hope at least one works on your device!
Our bet is no lowering of rates, which may be met with disappointment (lower markets)!
Mid-week, Jerome Powell current Federal Open Market Chief (FOMC) hinted that rate movement may be under review – this, the exact sentence is what Capital Market Participants applauded:
“…we will act as appropriate to sustain the expansion.”
As simple as it may sound, it’s meaning is strong. Simply put, the FOMC is aware of headwinds being caused by the tariff talks and are considering it as a factor in their estimate of the growth of the economy. Here is a link to the actual speech for those nerds like us!
Rewind to just two quarters ago when the FOMC was on record saying they planned on raising rates three more times, spurring the Holiday season Hissy Fit … Things certainly have changed –
This headline from Wall Street Journal Yesterday
But HOLD ON … this will make you scratch your head–
Robert Kaplan, Dallas Federal Reserve President – One and a half weeks ago during a lunch presentation! Take a moment to listen, it’s 1 minute and 14 seconds!
Different Audio types for differing browsers – same audio
Timely recording of the event…had no idea how pertinent it would be so quickly!
Feeling a bit like a reporter…. confused reporter, but reporter!!!
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investments may be appropriate for you, please consult your financial advisor prior to investing!
The is the vocal portion of J.K. Financial, Inc. a Dallas Texas Based Fee Only Total Wealth Financial Planning Firm. Founded by John Kvale, a Dallas Texas Fee only Financial Planner and Total Wealth Manager.