Trader shouts at the NYSE as Dow races to new high on heels of Fed decision to keep interest rates at zero. (Photo: REUTERS)
The Dow Jones Industrial Average (INDEXDJX:.DJI) close at a record high after the Federal Reserve announced it will maintain its stance on record-low interest rates. The move was widely accepted by the investor class who continue to erode purchasing and saving power from average, middle income Americans.
The Dow rose 24 points, or 0.2 percent to close at 17,156 Wednesday, topping its previous high hit in July by 18 points. The blue-chip average rose as much as 89 points after the Fed kept the phrase “considerable time,” in referring to how long it would wait before raising interest rates.
The Standard & Poor’s 500 index (INDEXSP:.INX) edged up two points, or 0.1 percent to close at 2,001, while the Nasdaq (INDEXNASDAQ:.IXIC) rose nine points, or 0.2 percent to 4,562.
The Fed has held the short-term rates it controls close to zero now for more than five years, which has artificially inflated the economy and fueled a bull market for stocks many say reflects future prices, otherwise known as inflation yet to be realized in the marketplace.
The Federal Reserve on Wednesday, as was widely expected and welcomed by Wall Street, kept interest rates near zero where it has been for nearly five years. The basic principle holds that diverting investments away from fixed assets n investment in equities. Then, as companies accrue extra capital, they hire and produce. However, the investor class is growing extremely wealthy through what most see as a perversion of trickle down economics practiced in the Reagan Era.
agreed to trim its bond purchases by another $10 billion to $15 billion per month as the economy continues making progress. Meanwhile, the central bank’s policy setting Federal Open Market Committee reiterated its commitment to keeping interest rates low for a “considerable time” after the asset-purchase program is phased out, which will likely occur next month.
