Who's The Real Fed Head?

The Fed raised rates 25 basis points and kept the "measured pace" language in. They spoke about robust productivity which bodes well for contained inflation in the future. They also paid some homage to the disruptions from Katrina and the softening economic implications.

We can't help getting the feeling that the spirit of Ben Bernanke ran today's Fed meeting wearing an Alan Greenspan Halloween mask. All-in-all the Fed meeting turned out to be a neutral event which may be perceived as dovish. We think the market will gyrate a little longer and ultimately find comfort in this news.

Any sell off from here is likely to be less harsh than we originally expected yesterday afternoon. We are slowly scaling into more Semiconductor positions.

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