Today's FOMC Language Will Tell All

Fed Ignores Contradictory Antidotal Evidence and Pushes Anti-Inflationary Measures

According to our economic council, yesterday's FOMC release set the stage for two conflicting messages – pointing to firming in household spending, but acknowledging negatives. The council considered the timing of stimulus package spending and the rise in gas expenditures as factors in household spending data; speculated that the Fed is attempting to make the economy’s long-term health a priority; and considered the possibility that the group doesn't want to lower rates further, possibly harming net interest margins just as they’ve begun to stabilize.

After every major economic announcement, the Economic Survival Council of m.rae resources provides bank-specific commentary in reaction to the news. The following alert is provided to our Kit subscribers. To read the full article on the Fed's most recent news, simply register for a free 30-day trial subscription.

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Take Your ALCO From Compliance to Strategic

by Jay Brew & Jamie Sumner

This article in collaboration with Dr. Ed Seifried. ALCO is the most important committee. And every board and management team must determine if their ALCO is driven by compliance, which satisfies regulators, or strategy, which satisfies regulators and monitors the strategic plan.

Market Data: A Mixed Bag of Positives and Negatives

by Frank Hassey

The latest economic data continues to point to a weak economy in the first half of 2008, but an economy that barely avoids a recession. The data is a mixed bag of positives and negatives. But the stock market is holding up reasonably well despite periodic volatility.

  

Vault Cash: The Next Frontier for Increasing Performance

by Christopher M. Puckett

Last December, U.S. banks carried on average over $350,000 per day, per branch, but used about $9,229. The result? $1.5 B in excess cash. So why the difference between known cash levels and needs?

Q&A: Would a sale-leaseback be a good option?

A lot of banks are feeling the pressure to find alternative, nontraditional ways to increase net income given the decrease in margins, the need to beef up provisions and the rise in noninterest expenses. We've seen a number of institutions find that additional funding source through the sale and subsequent leaseback of real estate that it owns.

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