New Fed Chairman Kevin Warsh Just Gave a Warning to Wall Street. Here's Why You Shouldn't Panic.
Interest rates are holding steady, but there's more to the story.
New Fed Chairman Kevin Warsh Just Gave a Warning to Wall Street. Here's Why You Shouldn't Panic.
Overview
After some drama at the Federal Reserve, economist Kevin Warsh was confirmed as chairman in May and chaired his first meeting last week. While the Fed's decision to keep interest rates steady was expected, Warsh's decline to provide guidance for the remainder of the year was new. In the past, the Fed has provided an outlook for the rest of the year.
Warsh has said that the guidance is meaningless in terms of what actually plays out, yet impacts markets in the short term, making them even worse than useless. The market was hoping to get some reassurance that the Federal Reserve would cut rates at some point, and without it, the market still took it as a future signal -- in this case, a negative one.
Details
The S&P 500 (SNPINDEX: ^GSPC) dropped slightly on the news. However, investors shouldn't panic. Here's why.
Source
Originally published at www.fool.com.
