How today's FED decision impacts you....

THE INSIGHT YOU NEED TO NAVIGATE THROUGH TODAY'S FED DECISION

LIESMAN'S TAKE ON THE FED CNBC's own Sr. Economics Reporter Steve Liesman, wants you to know how today's Fed decision affects you. As I read the Fed's monetary policy seconds after its release, something struck me as different. I couldn't quite put my finger on it for a few minutes. And then it hit me: unlike other statements, this was so predictable, maybe the most mature, policy statement to come from the Bernanke Fed. For a market pining for the days of the sure-handed leadership of the Greenspan era, this could be welcome news… if it continues. There's nothing easier to read than something you've read before. Of the 20 or so FOMC statements I've reported since Fed Chairman Ben Bernanke took over, this was the easiest to read, the least random in its wording. The reason: if you followed what Bernanke has said over the past several weeks, much of it has been said before either in the same words or nearly so. Before this, Bernanke seemed to be casting about in statements to find a different way from his predecessor to convey policy. He's been trying to throw off the straight jacket of predictability in exchange for up-to-the-minute honesty and creativity. But Bernanke looks have taken a page out of the Greenspan playbook here: tell markets what you're going to do and then deliver your committee on that promise...... Click here to view entire posting.

Fed Cuts by Half Point FOMC voted 9-1 for Fed funds rate cut, with Ron Insana, Steve Liesman, Bob Pisani & Erin Burnett. The Fed's Tough Call The Fed demonstrated to the market the central bank is taking swift action.... Stocks & the Fed Discussing whether the markets are steering the Fed or whether Fed decisions are driving the markets..... Wall Street's Reaction to the Fed A look at how Wall Street is reacting to the Fed's discussion to cut a half point....... Friend in the Fed When the Fed cut interest rates again today, the markets found a friend in the Fed, with Fast Money's Jeff Macke...... Fed's Policy Statement Draws Mixed Reviews The Federal Reserve cut interest rates another half point Wednesday, but economists are divided about whether its accompanying policy statement will successfully manage market expectations Having slashed its federal funds rate three-quarters of a point just a week ago, the Fed used much of the same language this time around in cutting both the funds and discount rates. But that statement also drew varying interpretations of what was next to come from a central bank that has surprised market watchers more than once in recent months..... Click here to view entire posting. Will the Fed's focus switch to inflation? Inflation currently is higher than it usually is when the Fed is cutting rates. Even though the last Fed forecast showed inflation easing, data recently have indicated the opposite when compared with the Fed's inflation target of 1.5 percent to 2 percent. This suggests that the Fed will not wait as long as it has in the past to reverse direction and begin increasing rates again. What will the Fed do next? The Fed's job is to focus on the medium term (12 to 18 months) with low and stable inflation providing the foundation for economic and job growth. However, presently the Fed appears to be driven not by the economy but by financial system instability. Believing that view, fed funds futures market traders think the Fed will continue to cut rates through mid-year to a 2.25 percent rate and keep it there into early 2009. What should savvy investors look for?? Investors will want to know whether the economy is responding to Fed stimulus. Among the many pieces of economic data to be released, the investor would be wise to look at upcoming data on employment and inflation that will be released in coming weeks. First on deck is the personal income and expenditures report including the Fed's key inflation measure (PCE price index) on January 31st followed the next day by the employment situation report. Inflation will continue to be monitored closely when the CPI and PPI (primary components of the PCE price index) are released mid-month.

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