Markets & Economy

Why the Fed was right to put off tapering

Dudley: 900,000 housing starts are nice, but I'd like to see 1.5 million

Future-Proof: Navigate Threats, Seize Opportunities at ICNY 2018 | Jan 22-26 at the Marriott Marquis, Times Square, New York

Economic data this week continued the Three Bears pattern, adding to the national state of annoyance. Porridge, porridge, porridge. Couldn't we have some that's too hot or too cold, just to break the tedium and take our minds off the replay of 2011 Budget Chicken? Long-term rates continued to fall this week, but gently, mortgages near or a little below 4.5 percent. The all-important 10-year T-note has made it almost to 2.6 percent from the 2.98 percent high three weeks ago -- all because the Fed un-tapered, and about the best we're going to do unless the economy weakens. New orders for durable goods (excluding transportation) fell 0.1 percent in August, but better than forecast. Personal income rose 0.4 percent and spending by 0.3 percent, exactly as forecast. Same for sales of new homes, stuck near 400,000 monthly, and pending sales of all homes, about unchanged. Second-quarter GDP did not revise; the final of 2.5 percent growth far short of the Fed's hopes. Claims f...