Rally In Ben’s Hands
As Bernanke gets set to testify before Congress Wednesday, the market will be watching his every move to determine whether Tuesday’s rally is sustainable.
Diane Swonk, chief economist for Mesirow Financial, said she expects Bernanke to stay on message in his prepared remarks to Congress on the economy and housing crisis. Inflation remains a concern to the Fed but expect it to take a back seat to worries about the broader financial market, Swonk said.
It is commonly accepted on Wall Street that the Fed was late on addressing this crisis, as Bernanke dawdled last summer when the signs were becoming apparent, according to Swonk. But now they think he’s doing the right thing. The Bear Stearns deal shows that Bernanke is capable of impressive, and much needed, out-of-the-box thinking, she said. Now all he needs to do is show some strength – some “testosterone” – in monitoring the situation that he created.
Karen Finerman expects nothing groundbreaking from the testimony. The Fed has made several major moves to address financial issues over the last couple months and now it just needs to let things ride, she said.
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Trader disclosure: On Apr.1, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Owns (DIS), (YHOO), (MSFT), (INTC); Najarian Owns (AAPL), (CSCO), (MSFT), (YHOO), (ORCL); Najarian Owns (AA) Calls, (BSC) Calls, (CCU) Calls; Najarian Owns (LEH) Puts, (MER) Puts; Najarian Is Long (XLF) And (XLF) Puts: Finerman Owns (GS); Finerman's Firm Owns (JCP), (MO), (MSFT), (VLO), (YHOO), (PM), (TIP):Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM), (GLD)