Changing Market Structure and Implications for Monetary Policy

Changing Market Structure and Implications for Monetary Policy

That’s the official title of the Kansas City Fed’s annual symposium in Jackson Hole, Wyoming and it seems very appropriate

Getty Images

The Kansas City Fed and its President Esther George are hosting their 42nd annual economic symposium in Jackson Hole, Wyoming this week. Global central bankers and leading bankers, CEO’s and economist meet to discuss the issues of the day so aptly described by the symposium’s title. Jerome Powell is attending as Fed Chair for the first time. The timing of this meeting is very interesting, if not important as it is being held just prior to the 10-year anniversary of the financial crisis. Friday morning, Powell will give a speech titled “Monetary Policy in a Changing Economy”, which again is a very appropriate title for the current economy he must study. It’s a changing one.

The Dow, S&P, and NASDAQ May Be Affected

The U.S. economy is not only in a shift from recovery to faster growth, global economies are different in a general. According to a statement put out by the KC Fed, discussions will include “the rise of very large firms and market concentration in several industries” since according to that same statement; they cost the economy capital investment, productivity growth and, wage growth among other things. Given those subjects, we are likely to get headlines out of the symposium that speaks to inflation which could affect the yield curve as well a talk of tariffs, the size of debt (especially emerging market, dollar-denominated debt) and Presidential influence on Fed decisions. We’ve already had both George and Dallas Fed president Robert Kaplan speak to that last point, echoing each other with an assurance of an independent Fed. In general, these topics have a high probability of moving markets. Historically, the Dow, S&P 500, and NASDAQ are calmer after the Fed Chair delivers a speech, but given the many differences in the current climate, both economic and political, the symposium is unlikely to be a symphony for stock markets. 

The information contained above may have been prepared by independent third parties contracted by Nadex. In addition to the disclaimer below, the material on this page is for informational and educational purposes only and should not be considered an offer or solicitation to buy or sell any financial instrument on Nadex or elsewhere. Please note, exchange fees may not be included in all examples provided. View the current Nadex fee schedule. Nadex accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representations or warranties are given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk and any trading decisions that you make are solely your responsibility. Trading on Nadex involves financial risk and may not be appropriate for all investors. Past performance is not necessarily indicative of future results. Nadex contracts are based on underlying asset classes including forex, stock index futures, commodity futures, cryptocurrencies, and economic events.

Trading can be volatile and investors risk losing their investment on any given transaction. However, the design of Nadex contracts ensures investors cannot lose more than the cost to enter the transaction. Nadex is subject to U.S. regulatory oversight by the CFTC.