(Atlantic) The Federal Reserve this week cut another $10 billion dollar’s in bond purchases.
Mark Smith, with the Principal Financial Group in Atlantic attributes their decision to the “growing underlying strength in the broader economy.”
“The Feds announced a couple of months ago that they were going to start tapering back on their bond buying program,” stated Smith, who admits it has caused a drop in the stock market. “People see this as hurting the economy because the Federal Reserve is no longer pumping money back into it.”
However, Smith says the Feds are confident the economy is growing on its’ own and they no longer feel these additional funds are needed.
“I look at this as a very positive thing,” said Smith. “Yes the market has sold off, but it also provides a buying opportunity. The Feds are doing what they think needs to be done. They are taking a slow approach which should help keep inflation under control.”
Meanwhile, the Stock Market declined five-percent for the first month of 2014. The drop follows a year in which the market gained 25-percent.
January 31, 2014