Anthony Chan Central Quotations

The CPI report continues to be encouraging. These numbers are stimulating consumer spending by giving consumers more spending power. At the same time, lower inflation will also encourage the central bank to do whatever they need to do.

The CPI report continues to be encouraging, ... These numbers are stimulating consumer spending by giving consumers more spending power. At the same time, lower inflation will also encourage the central bank to do whatever they need to do.

Now, with the economic recovery appearing to be somewhat in place and the central bank not lowering rates, we see people trying to get in at the gates before rates start to rise.

I think the markets probably overreacted when the Federal Reserve first moved toward a neutral operating directive. When Alan Greenspan spoke this time, I think the reality set in and that is, yes, the central bank has a neutral directive, but it's more like an ultra-right (hawkish) form of neutral directive. ... Any time they get an excuse to raise rates, they're going to take it.

I think this is an important first step for the central bank. They didn't want to lower rates too aggressively for fear of sending a signal to the markets that they thought things were completely falling apart.

This will certainly heat up the debate at the central bank,

The recovery is proceeding, but gradually, and that's actually healthy. It's the kind of recovery central bankers dream of -- gradual, not explosive, and therefore long-lasting and sustainable.

That report certainly reveals the recession is not over. The gains we had in September are not sustainable and illustrate why the central bank has to continue to lower rates. At this juncture, the easing of rates basically is serving as a consumer confidence booster.

Investors have become completely convinced that we need to see the housing canary buckle under a little bit. If the housing market softens, then investors will view that as the canary in the cave that indicates that central bankers will not have to be as aggressive.

The market doesn't want to see too much exuberance on the part of consumers in order to keep the central bank at bay.