Federal budget

The Federal Reserve Open Market Committee voted Wednesday to keep the federal funds rate at zero to 0.25% until the unemployment rate improves, and to continue monthly purchases of $85 billion in mortgage-backed and longer-term Treasury securities.

he following comments were overheard at a recent meeting of Debt-aholics Anonymous.

Gradual economic growth and little progress in the unemployment rate convinced members of the Federal Open Market Committee to continue with monthly Treasury purchases of $85 billion and to keep the federal fund rate at zero to 0.25%, according to a statement from the first two-day meeting of 2013.

While wholesale policy changes are not expected in President Barack Obama's second term, some new Capitol Hill assignments have sparked a glimmer of optimism among retirement and investment industry observers.

Uncertainty caused by last-minute congressional negotiations to avert the fiscal cliff created pessimism about the economy and markets in the short term, according to Pension & Investments readers responding to a P&I/Oxford University survey.

Any fiscal-cliff resolution is being seen as nothing more than a “bare-bones” extension approved by the end-of-the-year deadline.

The economic outlook for 2013 remains clouded by the on-going fiscal cliff talks in Washington and overall government debt levels here and abroad, Loomis Sayles Vice Chairman Dan Fuss, said in a recent P&I interview.

As politicians in Washington consider a resolution to the Fiscal Cliff, they could learn important lessons from people's opinion of profiteering.

Forty percent of respondents to the CFA Institute's annual global market sentiment survey expect the global economy to expand next year, up from 34% a year ago.

Eighty-three percent of Pensions & Investments readers believe a cut of retirement plan tax incentives would have a negative impact on retirement savings.

The fast-approaching fiscal cliff is causing some money managers to abandon traditional year-end portfolio moves in order to play it safer. Still other managers already are focusing on the next big crisis when Washington tackles the federal budget deficit.