Yesterday, the rumor turned out to be a joke. Today, there was no rumor, but as we warned four hours ago, it was only a matter of time. Less than four hours later, the time has come, and Jon Hilsenrath's "Fed Maps Exit from Stimulus", conveniently appearing after the close, has just been released.
From Hilsy, and one of his final attempts to remain relevant, pointing out what everyone already knew:
Federal Reserve officials have mapped out a strategy for winding down an unprecedented $85 billion-a-month bond-buying program meant to spur the economy—an effort to preserve flexibility and manage highly unpredictable market expectations.Don't expect an imminent announcement.
Officials say they plan to reduce the amount of bonds they buy in careful and potentially halting steps, varying their purchases as their confidence about the job market and inflation evolves. The timing on when to start is still being debated.The whisper sellside consensus is that it will be the September FOMC meeting, just after the Jackson Hole meeting at which Bernanke will be absent, that the first details of the flow "slowdown" will be revealed. But there is certainly no consensus.
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