The Fed Chief is currently speaking to the International Monetary Conference in Atlanta, suggesting that accommodative monetary policy is still needed. Talking of a mixed picture economy with slower than expected growth and high unemployment, he seems disappointed as to where we are at this point in time. Negatives mentioned are high fuel and food prices, slumping real estate prices, and continued tightness in the credit markets providing the current economic drag. He also sees a rebound in the second half of the year with inflation staying low. He continues to say that the Fed's primary objective is to foster economic growth and price stability at home. Traders have taken the ongoing speech/Q&A as net bearish for stocks (Dow closed off 19 points) and slightly positive for treasuries and other fixed income products. Net gains were just enough to give you the positive price change. The 10 year note is right back at 3.0%, near the bottom (best pricing) of the year. Call the market neutral with an edge to the bulls. Just perfect for a float down or two.
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