The market shouldn’t have been surprised by what Bernanke said on Wednesday. But it was. Bernanke had already flagged the reduction in the Fed’s bond buying program on May 22 and there was an immediate reaction in both bonds and stocks. When the market reaction is greater than presumed and when the market reacts this way to what is known it’s probably worried about something else. What everybody knows in the markets is seldom worth knowing. While Bernanke said things that were conspicuously disingenuous like that the backup in rates in May was due to the economy ...![]()
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