Opening Statement from the November 2021 Intelligent Investor (part 1)

Opening Statement from the November 2021 Intelligent Investor (part 1)

Originally published on November 3, 2021 (pre-market release)

Fed to Reduce its Bond-Buying Program

During the recent Fed meeting (November 3) Fed chairman Powell announced the highly anticipated start of a taper to its monthly purchases of $120 billion of U.S. Treasury and agency mortgage bonds, beginning with a reduction of $15 billion ($10 billion U.S. Treasuries and $5 billion mortgage-backed securities) in November, followed by an additional $15 billion in December.

Because the taper announcement was expected by most investors, the 10-year U.S. Treasury yield did not soar and the stock market did not selloff unlike the aftermath of the tapering announcement in 2013 which caught investors by surprise. 

The Fed plans to reduce its monthly purchases...