What looks like a duck, quacks like a duck ? ....... a duck ! What will the Fed do today ?

So what looks like a economic slow down, quacks like an economic slow down ?   ..... an economic slow down !

The world has been looking to China as the engine of growth to drive economies around the world and keep the stock markets up. Well today China's latest trade surplus for July was announced. China's trade deficit for July ($28.7 billion) increased by 40% from June ($20 billion). This increase was due to a very large decrease in imports swamping a smaller decrease in exports. Appears that economic activity in China, is slowing.


As said before, after earnings season, the market will start to concentrate on economic news again.

The Federal Open Markets Committee, the FOMC will make their much anticipated announcement at 2:15 p.m. ET. Will the Fed announce today that it’s completely exhausted its effective policy tools ?

The FOMC will  leave the fed funds rate in this zero to 0.25% band. This has been the range for more than a year.  What is the Fed’s going to do next to stop the economy from decelerating, or rolling over ?
There is not much more for them to do. Maybe the Fedwill take the maturing assets on its balance sheet, and redeploying the money it gets back into the bond market. This is the prayer that has been keeping the market strong. If the Fed activates this program, it would be a neutral move at best. What is needed is job growth and consumer spending. Fed liquidity is not the problem.