If uncertainty and volatility are to decrease in the financial markets, it's imperative for Bernanke to be reappointed as Fed Chairman. Bernanke has performed well in the midst of the "Great Recession", although the long-term ramifications of his policies have yet to be realized. The stock market is in love with his policy of low-interest rates, fueling the economy with cheap borrowing. Over the past few days, the market has reacted negatively to any news of Senators voting against Bernanke.
According to Dow Jones Newswires, 40 Senators have confirmed their support for Bernanke while 17 have opposed it. In order to be reappointed, Bernanke needs 60 votes. With the President and the stock market already supporting his reappointment, and already having the support of a majority of voters, it stands to reason that Bernanke will be reappointed and the stock market will react mildly positive to this news (most of the positivity has been priced in today, in my opinion).
Most likely, more important economic data and earnings releases that come later in the week will trump the news that Bernanke is reappointed.
The final result will likely be this Thursday or Friday.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment