Karim Basta on the Federal Reserve

You know we haven't got enough earnings news yet to really move the market what we have received some data as a relates to unemployment I thought it would have a more positive impact on the futures it did not. Now the market is open June. How we look at okay. Just as you said all red Dow down 71 NASDAQ down 25 points. S&P 500 down nine points to thirteen 31 oil trading down 107. 8473. Tenure US treasury down slightly at one point 486. Angle it's still trading down 1740 to 1558. To me I'm surprised triple that and just say. I thought it leaked -- and -- been flat. Ready not aiming and that could be gay sex where we have declining markets. You know the Federal Reserve about every six weeks will issue notes from their previous meeting that was done yesterday. Not many people read them because not many people can understand. Gentleman who can't understand them is -- -- he joins us today he's our guest. Good morning -- welcome to the show -- There are good. -- what did you glean from the Federal Reserve notes that were released yesterday lead it and it was based on the meeting held in on June 19 and twentieth I believe. -- what did you learn. While neglecting the biggest message we actually got to be actual meeting when the the new forecast from the committee were publicly released spend. Those work out for growth were cut. You know fairly meaningfully. And on the back of that because he had the -- and that. So called Operation Twist was. Previously set to expire at the end of June was extended through the end of the year. So. The -- yesterday did not really have a lot more and and I don't think that should be that surprising to because you know a new program. Was just put in place. The committee you know is bad credit are talking about they're in the door opened if additional action. Kind of openly wondering about you know additional school but -- -- people be used that. They may not have at their disposal right now. But I think it that is sort of baseline there was really no in that. They're gonna change course from. Operation Twist to if you will. You know could be over the next few months. -- rate now the ten year treasury yield is 148 what would the yield the courting your estimates anyway. If they weren't doing Operation Twist would it be 2% two and a half percent. How high would interest rates the Operation Twist were not in effect. Well it's a little hard to cheat you know operations whereas. Effort from all the other. Immediate action they've done you know be the QB operation that he will the committee -- Impact on on the market they call that we've the stock of treasuries that they -- not not the flow. But that the vice chair -- -- -- Janet Yellen -- each a few weeks ago where she made a remark that. In her current engaged in the cumulative impact of all of their activity. That the ten year treasury to be about sixty basis points lower than it would otherwise be -- you're you're pretty close you know calmer between two and recorder I think. To to a crime now the -- the Fed alluded that'll we still have more tools and our toolkit to stimulate the economy. For the life of me I don't really know what they are rather than continuing to buy treasuries. What else for ten the Fed do to stimulate our economy which is anemic right. Right right well you're you're right there. Certainly as you as you look at it by measuring treasury -- not a lot. I think it like to continue to try to find ways to get mortgage rates down. You know one of the frustration. 2 PM BS for -- visit they had in the past is that. They were able to get secondary mortgage. Rate down -- the primary -- are likely borrow. Have been all that back so you know edit kind of unclear. What exactly they can do or maybe he needs some. But legislative. Permission to you know undergoes some. Some action that they they haven't sephardic primary rate lower but I think that would certainly be. And objectives. So did get it contained the lower housing current lower mortgage rates he think I might stimulate housing a little bit more than that because it's how what may -- 11% year over year resident. Right right -- -- up. You know quite a bit on tea. Yet senator you're in -- percentage basis but is it all and two it's such a small party economy that you know I didn't take much get. Speak up for and it's into. With Joseph what do you think the GDP will be for this year -- morale one and a half 2%. You have there I think that I've become early. Or you can sense that that due to look -- that -- and I think. The second pastor today look. More or less stay in line that I think there's some. Offsetting forces you know a major positive and obviously the decline in energy prices and commodity prices in general that. Is gonna boost really come -- but I think you know countering that is -- it it about it and and -- yesterday. That uncertainty. Over the fiscal collapse. So to speak at the end of the air is already creeping into businesses. Delaying hiring -- cut isn't just got I don't know what you. The tax went aid for the regulatory landscape is going to be. Did dad did then come out in and say -- you know we should get more done by congress and stop relying on the Fed because he's done that in the past street say he read rather admonished. The congress for not making more in the way of legislative changes to inspire the economy did you -- battered it was or any language like that in the notes. It's -- up in the minutes that you're you're right he has done that in the past and you know he you don't have. Congressional testimony next week I'm a certain it'll come out and then I think it'll be a very tricky. Exercise for him being you know very close election and then the parties you know are putting out their various acts by and then. They'll be out and his opinion on those then that it's very delicate exercise though could -- look at that message across he'll have to or like. All right -- Kareem I sure appreciate your time thank you very much for joining us. -- that's Korean -- that joining us today on the financial exchange you have to have an interpreter. When it comes to fed speak to -- just Nelson and I'm glad we did we do. Got -- part parts finding them donating it. Yeah certainly eat what you get them on you can understand the hard part in the difficult aspect of it is is finding them.