Just for the record, we think the Federal Reserve is really trying to set one particular expectation for investors.
How do we know? Let's just say that we haven't missed how the Fed's top officials have been flooding the zone during the last two weeks to direct investors to focus their attention upon the near term....
- 29-Jun-2015: Fed's Dudley Says September Rate Hike 'Very Much in Play': FT
- 30-Jun-2015: Fed's Fischer Sees Gradual Rate Increase
- 1-Jul-2015: Bullard Sees U.S. Sheltered from Greek Crisis, September in Play
- 2-Jul-2015: U.S. Jobs Report Is Unlikely to Derail Fed's Interest Rate Hike
- 6-Jul-2015: Big Question: Will the Greek Crisis Delay a Fed Rate Hike?
- 7-Jul-2015: 5 Things to Watch in the Fed's June Meeting Minutes
- 8-Jul-2015: Fed's Williams: U.S. Still on Track for 2015 Rate Rise
- 9-Jul-2015: Fed's George Says Central Bank Should Implement Modest Rate Rises 'Now'
- 10-Jul-2015: Wall St. Rises; Yellen Expects Fed to Raise Rates This Year, But Cites Labor Weakness
- 10-Jul-2015: Fed Rate Hike Possible This Year; Greece Looms: Rosengren
- 13-Jul-2015: Fed's Mester Supports Two Interest Rate Increases in 2015
- 14-Jul-2015: Fed's George: Economy's Ready, 'It's Time' To Raise Rates
And also for the record, what they have succeeded in doing is focusing investors on 2015-Q3. And while the news from Greece has added positive noise to U.S. stock prices since 10 July 2015, boosting the value of the S&P 500 almost exactly 3% higher than they might otherwise be, that figure is still within the typical range we would expect if investors were tightly focusing their attention on the expectations they have that are associated with 2015-Q3.
Which is to say that the stock market is running somewhat on the hot side of things. Plan accordingly.