The Fed -- Couldn't Possibly Have Been More Dovish -- February 1, 2023

Most folks did not hear JPow using this word, but he used it more than once. 

Fed rate:

• up twice more this year unless things get appreciably worse;
• 25 bp today and 25 bp twice more this year
• Americans have gotten use to current Fed rate
• current Fed rate is the new floor for the foreseeable future
• which means: that another 75 bp increase by end of year is a non-event
• so many opportunities to be hawkish -- and never took the bait
• 25 bp in March and then pause and / or one more 25 bp before summer

Jobs:

• finally seeing some clearing of the "fog" regarding jobs
• all good news
• analysts spent too much time on jobs
• JPow seemed much less concerned about jobs
  

Covid-19:

• it's over; get over it

JPow:

• seems comfortable
• no longer angry

The only worry:

• GOP delays raising the debt ceiling
• the debt ceiling will be raised but the concern is if the government defaults for even one hour -- the message that would send

Dow:

• down as much as 300 points before JPow spoke
• now, Dow is up almost 100 points
• technology stocks leading
  
• NASDAQ positive more than 2%
• investors seem "more with it" than the analysts
• ignore the analysts; watch the market
• US dollar "sinking" -- in the current environment -- good to see