I know a lot of traders were looking for clear signs of either an exit strategy for the debt repurchase program or just a sign that the Fed was considering interest rate hikes in the future And neither of that was provided. But I think, given what we’re seeing now, and the current state of the economy, I think the Fed did the right thing by trying to keep yields down.”I think the big thing is that although economic conditions have improved over past several months, it’s important to understand that the economy is by no means out of the woods.”I think the goal of their statement was to keep mortgage rates from rising too much. Looking at new home sales figures, which were flat the last four months, it was a good instinct for the Fed to try to keep mortgage rates down.”Right now, the market is trending down. It looks like we’ll potentially close with a loss for the day. But the week ahead will see earnings coming out that will likely have an impact, like Nike for consumers and Micron for semiconductors.”ROBERT CALLAHAN, MANAGING DIRECTOR, NEWPORT VALUE PARTNERS, NEW YORK:”The Fed is trying to reflate this economy, lending banks money at a rate as close to zero as the banks in turn can lend it out at higher rates They’re trying to resurrect the banks.

(As far as dropping the reference in the last FOMC statement to ’some risk that inflation could persist for a time below rates that best foster economic growth,’) they’re reacting to the fact that oil has gone from $40 a barrel to almost $70 a barrel.”Secondly, notwithstanding yesterday’s auction, 10-year yields have been rising… rates have to go up to protect the dollar or it all comes tumbling down.”STEVE VAN ORDER, FIXED INCOME STRATEGIST, CALVERT ASSET MANAGEMENT, BETHESDA, MARYLAND:”It’s essentially the same statement as the last one They expect inflation to stay subdued This language reasserts that. They seems to say they are not as concerned with the worst case scenario on deflation.”If you don’t buy that argument, you sell the long bond. The statement is a touch more dovish with the output gap argument that counter-balances what they say about inflation. It implies the market is pricing in a Fed rate hike too soon.”The nervousness of the seven-year note auction is coming up, and we are not quite sure how to read the auctions now with the indirect bids.”BILL O’NEILL, MANAGING PARTNER, LOGIC ADVISORS, UPPER SADDLE RIVER, NEW JERSEY:”I would say neutral to maybe slightly positive (to gold), only in a sense that the Fed eliminated the deflation threat, so that was no longer an issue.”This was a Fed statement that really has little surprise and little change. The markets are going to function on the factors that they have been focusing on.

In the case of copper, it’s certainly going to be China, as well as demand outside of China and also the currencies.”KIM RUPERT, MANAGING DIRECTOR, GLOBAL FIXED INCOME ANALYSIS, ACTION ECONOMICS LLC, SAN FRANCISCO:”I think everybody was looking for something more dovish. But it’s also the case, in our view, that perhaps the market is selling off a bit by the lack of an exit strategy, or that this is sort of a bond vigilante’s revenge that the Fed isn’t looking to sop up a lot of the excess liquidity in the market any time soon.”CARL BIRKELBACH, CHAIRMAN AND CEO OF BIRKELBACH INVESTMENT SECURITIES IN CHICAGO:”The Treasury is going to have to keep coming to the marketplace for about $2 trillion. I think all these sales have gone well, but there is a high probability that along the line we’ll be looking at higher interest rates. There’s too much paper to sell to investors.”We have an economy on steroids at this point, with the TARP and the stimulus package. We’re reaching a point where the Fed isn’t exactly worried about inflation, though commodity prices seem to still be going up despite the flat economy.”They’re getting themselves stuck a little. We’ve avoided another Great Depression, but on the other hand commodities are going up while the economy is flattening out We used to have a term for that — stagflation What we’re moving into is a great sideways period It’s not a v-shaped bottom, it’s an elongated upward battle. We continue to have rising unemployment and housing prices falling.