Exchange traded funds (ETFs) can be influenced by the Federal Chairman Ben Bernanke’s decisions. For example, when the Fed cut interest rates in September, many ETFs increased. That’s one reason why investors and analysts always seem to hang on every word he says. "Will he raise interest rates or won’t he?"
Recently, Bernanke explained some of what influences how he makes tough decisions such as whether to raise or lower interest rates. He said Federal Reserve policymakers must weigh a broad range of economic scenarios to determine the right moves on interest rates during times of uncertainty, reports Jeannine Aversa for the Associated Press.
"Uncertainty – about the state of the economy, the economy’s structure and the inferences that the public will draw from policy actions or economic developments – is a pervasive feature of monetary policymaking," Bernanke said. "Notably, we now appreciate that policy decisions under uncertainty must take into account a range of possible scenarios about the state or structure of the economy. Those policy decisions may look quite different from those that would be optimal under times of economic certainty."
Again, investors are left to speculate whether the Fed will cut interest rates once more when it meets on Oct. 30-31.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.