NEW YORK (TheStreet) -The Federal Reserve's Open Market Committee did it again.
But why should investors be surprised just because it last week lifted our expectations only to give us the same old song (SOS).
Time is running out for the FOMC to keep giving us the SOS while the economy gets weaker and weaker. It did say (sort of) it'll inject fresh stimulus if necessary into the imploding economic expansion to boost growth.
The U.S. reports on the unemployment rate and nonfarm payrolls for July will come out Friday. The jobless rate has been stuck at 8% or higher for more than three years, so this is a sensitive subject.The FOMC did add a new verse to the SOS. It said it "...will provide additional accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability." As Archie Bunker used to say after someone told him something unimpressive, "Whoop-tee-doo!" Then the FOMC added, as if we didn't already know, "Economic activity decelerated somewhat over the first half of this year." This SOS should be sung to the beautiful melody of the old hit "See You in September." The FOMC wants us to know it is ready and set but that it's not unloading yet. Just take a look at this two-year chart of the S&P 500. You'll see as plain as the nose on an elephant's face that the FOMC likes to wait until somewhere between late August (the Jackson Hole, Wyo., retreat) and the September meeting to drop its payload and goose the stock market higher and higher. I expect to see it happen again this year. Between now and then the stock market may cause seasickness to those who don't have sea legs. If it drives the averages lower to scare the nervous herd, consider accumulating two companies that tend to help serve each other's businesses. FedEx (FDX) is the king of air, ground and freight delivery services. If you need to get something somewhere in a hurry and by an appointed time and date, FedEx is the way to go.
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