The Fed Decision: Maintaining an Extremely Delicate Balance!

This is particularly important because of the Fed's dual mandate of price stability and maximum employment. With unemployment expected to remain elevated for the foreseeable future and little inflationary pressure from the CPI thus far, the Fed is in no rush to tighten.

It was important for it to appear hawkish enough to guarantee that it will not allow inflation to develop. However, it also had to be dovish enough to avoid disrupting the current stabilization of the financial markets. It truly had to maintain an extremely delicate balance.

The only major change in the statement is the vehemence of Thomas Hoenig's dissent. However, he still remains the lone voice against the statement.

There does not appear to be monetary tightening on the near-term horizon. The types of programs used to inject money into the economy are more a question of form rather than substance.

The Fed will most likely utilize speeches by Fed officials to telegraph any significant changes in monetary policy to minimize the chances of confusion and disruption in the market. This has been and will continue be the pattern for the near future.

Doug Roberts is the Founder and Chief Investment Strategist for ChannelCapitalResearch.com, an independent research firm focusing on investment strategies using the Federal Reserve's impact on the stock prices.