Stop the Madness!

Stocks sprinted higher on Janet Yellen's speech Friday morning while bond rates headed lower as did the dollar...and all was right with the world.

Then the madness started.

I am referring to the crazy notion that investors put more merit into the comments of another Fed official, Stanley Fisher. He has always been a bigger hawk than Yellen, thus not surprising that he makes it seem like rates should go higher sooner...but since when has his view carried the day at the Fed???

Exactly! We all need to stop the madness now. The ONLY voice that matters at the Fed is that of the Chairman.

Yes, it's true that the others are entitled to free speech, and often provide differing views from the Chairman. But when it comes down to the time to vote, the Fed Chairman always gets their way. And Yellen's way is to keep rates lower for longer with a very cautious approach to future rate hikes. This is a positive for stocks as the much more attractive investment versus bonds or cash.

Best,

Steve Reitmeister

Executive Vice President, Zacks Investment Research

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