The market looks mixed this morning on confusion over what to do with the market given the Coronavirus.  The shutdown of economic activity in China appears to be continuing, but that potential negative is being offset with the likely global monetary and Chinese fiscal stimulus that would come as a result of a more dramatic slowing.  The global central banks have made it crystal clear they stand ready to add stimulus on any global growth deterioration, and the likely Chinese growth rate is sure to see a significant slowing.


We are going to get a better look at what the Fed thinks about the risk to the global economy Tuesday and Wednesday when Fed Chair Powell is on Capitol Hill to discuss the economic outlook.  We expect more commentary that suggests they are going to be accommodative until core inflation gets above their 2% target rate.  That is going to take a long time, especially given the potential dampening effect of the Coronavirus.



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