The Federal Reserve agreed to slow down the pace of a $1.25 trillion program to buy mortgage securities, according to minutes from the FOMC meeting. Clem Chambers, CEO of ADVFN, and Charles Crane, managing director at Douglass Winthrop Advisors, offered their views on the Fed meeting minutes.
“We’re releveraging, therefore [markets] are going up,” Chambers told CNBC.
“It’s just about a wall of money and about money supply. There’s a lot of money supply in there and it’s popping out in assets because the consumers aren’t allowed to get their hands on it—so it’s coming out in other places and coming out in assets.”
Chambers said the markets will go back and forward through the current level, but eventually will surge upward by year-end. “We’re on our way to [Dow] 11,000-11,500 by Christmas time,” he said.
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Crane said the Fed’s minutes were not surprising—overall.
Bu, he noted, “It is interesting to hear them say that the risk longer-term on inflation is to the upside—that’s the first time we’ve heard that.”
In the near-term, Crane said assets that have inflated the most in the last several weeks and months will be the first to go down.
“I’m concerned that goldis a little bit ahead of itself, especially in light of the comments we heard from the Fed on short-term inflation risk,” he said.
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No immediate information was available for Chambers or Crane.