The much-anticipated Jackson Hole meeting of central banks is nearly over, so it won’t be long before investors know how the market responds … tumbling down or zooming higher.
It all depends on the Federal Reserve’s taper message, and how quickly they take away the punch bowl.
With COVID’s delta presenting a major unknown, there’s really no telling until we hear from Fed Chairman Powell himself.
That’s why, in today’s video, I reveal which scenarios may unfold and opportunities in stock sectors that depend on which message emerges from the Fed.
How Tapering Will Impact Stocks
There are two scenarios that can unfold in the wake of the Jackson Hole speech, and the stock market reaction may surprise you.
As we discussed in Monday’s Your Money Matters, there’s a lot of pressure on the Fed to pull back economic support. That’s because $4 trillion has already been spent on asset purchases.
And if the Fed does decide to take away the punch bowl, the first to go will be the quantitative easing program. They’ll slow the amount of purchases made until it hits zero.
That could trigger a domino effect that cascades over many corners of the stock market.
Today I’ll show you two charts I’m watching to track the Fed’s critical mandates, and how one element of uncertainty could derail the Fed’s plans altogether.
Click here to watch this week’s video or click on the image below:
Best regards,
Clint Lee
Research Analyst, The Bauman Letter
