To wrap up the minutes from the July meeting, there were little changes from prior statements. The members indicate broad support for Chairman Bernanke’s timeline, which hinted for tapering as early as September. However, this was seasoned with cautious comments regarding the labor market, “The June employment report showed continued solid gains in payrolls. Nonetheless, the unemployment rate remained elevated, and the continuing low readings on the participation rate and the employment-to-population ratio, together with a high incidence of workers being employed part time for economic reasons, were generally seen as indicating that overall labor market conditions remained weak.” […]

Yesterday, the stock market action played out as expected. Long-term rates continued to climb up while stocks continued to sink. The only good news was that trading volume remained light, so there is no conviction on the down move. This move is most likely a small equity correction and stocks will continue to trend up after it. However, when it comes to the market, nothing is written in stone. If there is a major change in Fed policy and rates continue to rise, the market WILL crash. […]