With the withdrawal of Larry Summers as Fed Chairman yesterday, the result has been an astounding, thank goodness for stocks. Larry Summers was the most hawkish of the possible candidates. Most people thought if he were to be the next Fed Chairman, the so called “sugar” would be taken away from the party. With his withdrawal, this plan of action seems to be unlikely. Janet Yellen is now the front runner, and with her dovish perspective, the Fed will probably keep the printing presses on for quite some time. The markets were ecstatic overnight as futures were up close to 200 points, with a follow through as we speak. Additionally, the bond market is rallying with yields moving lower again.
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