Who would have thought that the market mover would be Mr. Bernanke's written testimony at 8:30 a.m. ET, and that the Q&A would elicit a yawn?
But that's exactly what happened. The written testimony dropped 10-year yields almost 10 basis points, but the Q&A did not move the stock market at all. There were expectations that, since the testimony was released early, the questioning would be more pointed and aggressive.
Didn't happen. Lots of questions on Fannie Mae and Basel III, but no barbs; in fact, parts of it sounded like a love fest.
Some were also expecting Mr. Bernanke to get a little more aggressive in his criticism of Congress' inability to enact more meaningful fiscal reforms. Wrong again! Not a peep from the chairman on this.
You have to hand it to Bernanke. It's obvious his biggest concern is not letting rates get away from him, and he played this one perfectly.
How many times can the poor guy say they are completely data dependent (bond tapering "are by no means on a preset course")?
How many times can he say he really doesn't think the economy is doing all that great ("the jobs situation is far from satisfactory")?
How many times can he say that the "recovery" is looking fragile ("The economy remains vulnerable to unanticipated shocks")?
Then...this is the best part...he made it clear that a 6.5 percent unemployment rate would not necessarily be the threshold for raising rates, then went on a long discussion of the conditions under which he would NOT raise rates, including if the unemployment rate dropped mostly due to cyclical declines in the labor force participation rate rather than gains in unemployment, as well as persistently low inflation.
As performance art, this rates an A. Of course, to Bernanke's many bitter enemies, who are insisting--with some justification--that tapering IS tightening, they can only shake their heads and wonder.
There's always tomorrow. Rand Paul, you there?