As the DOW is just a short distance from 17,000 all are looking forward to great jobs numbers in the U.S. A ballpark figure they say is 300,000 new jobs - if such a number have been created for June, wonderful. If not, a reason not to taper, or not to reduce the QE, which is currently trimmed down to $45 billion per month.
On the question of the reduction is QE, I would frankly say that any more reductions will hurt the economy, and set it back, precisely when it is poised for achieving the best come-back to total Recovery, which I believe will take another six months or so. In the meantime, it may be my suggestion that Dr Yellen either increases the figure by $5billion a month (that would take care of the social security aspect) and also to consider the rationale that the easing was introduced over a period of 20 months, hence the taper ought also to be farmed out over 20 months, and not speeded along over a period of 12 months.
Everything being equal, the exuberance of the markets will very probably take the DOW upto 17,000 a beyond today. The good news is both expected on the jobs front and predicates the strength of the underlying Recovery.
And the goods news I think may be that the DOW will go even beyond that in the foreseeable future, with the adjusted stimulus measures in place.
Go on, Dr Yellen, cheer the markets on, and adjust the figure so that it helps achieve total Recovery.
Durudarshan H. Dadlani