{"id":3187,"date":"2016-04-21T14:05:37","date_gmt":"2016-04-21T18:05:37","guid":{"rendered":"http:\/\/162.223.13.186\/~zacksim\/the-fed-and-the-dangers-of-the-dove\/"},"modified":"2022-02-26T13:22:20","modified_gmt":"2022-02-26T13:22:20","slug":"the-fed-and-the-dangers-of-the-dove","status":"publish","type":"post","link":"https:\/\/zacksim.com\/blog\/the-fed-and-the-dangers-of-the-dove\/","title":{"rendered":"The Fed and the Dangers of the \u2018Dove\u2019"},"content":{"rendered":"<p>U.S. equity markets started the year on a shaky note by falling some 10% through mid-February. Most of the selling pressure came from perceived weaknesses globally, which engendered heightened fear of a recession. In the end, the market recovered as negative views were supplanted in favor of more positive perspectives.<\/p>\n<p>Nevertheless, in March, the Federal Reserve shifted to a more dovish tone indicating, fairly explicitly, the intent to slow the pace of rate hikes this year (edging away from the original plan).<\/p>\n<p><strong>Fed Succumbing to Short Term Volatility?<\/strong><\/p>\n<p>The Fed\u2019s 25 basis point hike in December was consistent with the Fed\u2019s long-term objective of normalizing interest rate policy; desired as the economy expands at a modest but acceptable pace and as labor markets improve. But, the Fed appears to have lost sight of the long-term objective by altering course on monetary policy; believed in response to stock market volatility and the accompanying negative headlines.<\/p>\n<p><strong>Bottom Line for Investors<\/strong><\/p>\n<p>While barely into the first couple of months of the tightening cycle, a reversal in the Fed\u2019s monetary stance could be a sign of nervous governance. At Zacks Investment Management, we believe it is imperative, long-term, that the central bank remain focused on economic fundamentals and long-term goals versus short-term thinking relative to market volatility. Not only does this approach build credibility for the world\u2019s most important central bank, it also allows markets to price-in future rate hikes with certainty \u2013 which could go a long way toward reducing volatility. Stay the course, Fed.<\/p>\n<p style=\"text-align: center;\">\n","protected":false},"excerpt":{"rendered":"<p>U.S. equity markets started the year on a shaky note by falling some 10% through mid-February. Most of the selling [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":4124,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[71,72],"tags":[],"class_list":["post-3187","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-private-client-group","category-steady-investor-news"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3187","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=3187"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3187\/revisions"}],"predecessor-version":[{"id":11387,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3187\/revisions\/11387"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=3187"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=3187"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=3187"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}