FED SURVEY

March 15, 2016

These survey results represent the opinions of 42 of the nations top money managers,
investment strategists, and professional economists.

FED SURVEY

They responded to CNBCs invitation to participate in our online survey. Their responses were
collected on March 10-11, 2016. Participants were not required to answer every question.

April 30,

Results are also shown for identical questions in earlier surveys.

This is not intended to be a scientific poll and its results should not be extrapolated beyond those
who did accept our invitation.

1. At its March meeting, the Federal Reserve will:

0%

Raise interest rates

Lower interest rates

10%

20%

50%

60%

70%

80%

90%

0%

95%

0%

CNBC Fed Survey March 15, 2016

Page 1 of 30

40%

5%

Keep rates unchanged

Don't know/unsure

30%

100%

FED SURVEY
March 15, 2016
2. After this months meeting, the Federal Reserve's next
move will most likely be:

FED SURVEY
0% 10%

Jan 27

Mar 15

April 30,

20%

30%

40%

50%

60%

70%

80%

88%

Raise interest rates

90%
10%

Lower interest rates

Move to negative interest rates

Launch new quantitative easing

90% 100%

10%
0%
0%

3%
0%

When will the Federal Reserve make its next move?

Jan 27 Survey

March 15 Survey

For respondents
who said:

Average month:

For respondents
who said:

Average month:

Raise interest rates

(88%)

May 2016

Raise interest rates

(90%)

June 2016

Lower interest rates

(10%)

August 2016

Lower interest rates

(10%)

October 2016

Move to negative
interest rates (0%)

--

Move to negative
interest rates (0%)

--

Launch new
quantitative easing
(3%)

April 2016

CNBC Fed Survey March 15, 2016

Page 2 of 30

Launch new
quantitative easing
(0%)

--

FED SURVEY
March 15, 2016
3. How many times will the Federal Reserve hike rates this
year (2016)?
5.00

FED SURVEY
April 30,

4.50

4.00

3.50

3.00

2.8

2.50

2.1
1.9

2.00

1.50

1.00

0.50

0.00

Dec 15 '15

Jan 26 '16
Survey Dates

CNBC Fed Survey March 15, 2016

Page 3 of 30

Mar 15

FED SURVEY
March 15, 2016
4. New policy measures announced this week by the
European Central Bank will:

FED SURVEY
April 30,

50%

46%

46%

45%

40%

35%

30%

25%

20%

15%

10%

7%

5%

0%

Help the ECB hit its

inflation target over the
next several years

Have no effect on
inflation

CNBC Fed Survey March 15, 2016

Page 4 of 30

Don't know/unsure

FED SURVEY
March 15, 2016
5. As a result of new ECB policy measures, the US Federal
Reserve will:

FED SURVEY

70%

April 30,

59%

60%

50%

40%

32%
30%

20%

10%

5%

5%

0%

Enact fewer
rate hikes

Enact more rate Not be effected

hikes
by ECB policy

CNBC Fed Survey March 15, 2016

Page 5 of 30

Don't
know/unsure

FED SURVEY
March 15, 2016
6. Do you believe negative interest rates

FED SURVEY
Yes
April 30,

No

Don't know/unsure
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

23%

63%

Can help stimulate economic growth?

15%

31%
54%

Can help increase inflation?

15%

70%
Create more problems than they solve
and should not be used?

18%
13%

37%
Could be useful in Europe but should not
be used in the US?

54%

10%

CNBC Fed Survey March 15, 2016

Page 6 of 30

FED SURVEY
March 15, 2016
7. What do you believe are Janet Yellen and Stan Fischer's
federal funds forecasts for ... ?

FED SURVEY
Janet Yellen
April 30,

Stan Fischer

4.0%

3.36%

3.5%

3.02%
3.16%

3.0%

2.76%

2.5%

2.15%
2.0%

1.90%
1.5%

1.12%
1.0%

0.98%
0.5%

0.0%

2016

2017

CNBC Fed Survey March 15, 2016

Page 7 of 30

2018

The longer run

FED SURVEY
March 15, 2016
8. The current presidential campaign is:
60%

FED SURVEY
April 30,

56%

50%

39%

40%

30%

20%

10%

5%

0%

Positive for the

economic outlook

CNBC Fed Survey March 15, 2016

Page 8 of 30

Negative for the

economic outlook

Having no effect on
the economic outlook

FED SURVEY
March 15, 2016
9. Which would be the best presidential election outcome
for the economy?

FED SURVEY

45%

April 30,
40%

40%

35%

30%

26%
25%

20%

18%
16%

15%

10%

5%

0%

A Democrat
wins

A Republican
wins

CNBC Fed Survey March 15, 2016

Page 9 of 30

Doesn't matter

Don't
know/unsure

FED SURVEY
March 15, 2016
10.

Which candidate
Has the best economic policies?

Would be best for the stock market?

FED SURVEY
April 30,

0%

10%

20%

0%
0%

13%
14%

42%

Kasich

35%

8%

Rubio

11%

11%
0%

Don't
know/unsure

CNBC Fed Survey March 15, 2016

Page 10 of 30

50%

22%

Trump

Cruz

40%

16%

Clinton

Sanders

30%

11%

19%

FED SURVEY
March 15, 2016
Comments:
Trump and FED
Sanders
would be worst for stock market.
SURVEY
AssociatingApril
any of
these candidates with the word "best" is very
30,
difficult to do. They strike me as equally awful.
Continued monetary easing by major non-U.S. central banks is a
key to U.S. prospects later this year and next. The monetary
easing by the ECB and later BOJ will help raise price inflation
going forward. The stock market needs higher price inflation for
its next major run up.
Clinton is same old, same old and opposed to fracking- not good.
Sanders is let-the-good times roll until the bills roll in and the
rich people who pay them leave. Trump will splurge on public
works projects like wall building and haranguing our competitors
over freer trade. He will be contentious but it might work.
Rubio/Cruz are anti-Fed and looking to shrink government. Not
the best agenda for short-term growth anyway. Kasich is more
centrist. Will not gut but will implement sounder fiscal policy. No
sense of where he stands on free trade, which should be the key
issue of this election.
You can probably put a piece of paper between the economic
policies of the mainstream Republican candidates (excluding
Trump), but I am favoring Kasich because of his willingness to
work across the aisle, which I believe the stock market will be
more comfortable with.
Election outcomes have a smaller and shorter-lived impact on the
markets than popular thinking suggests.
Rubio is just more of the same, no surprises/no solutions. Wall St.
likes the status quo. Cruz offers meaningful solutions to address
longer-term issues that need to be addressed. Cruz is willing to
make the tough decisions IMO.
CNBC Fed Survey March 15, 2016
Page 11 of 30

FED SURVEY
March 15, 2016
Clinton's views on markets and economy are well known and well
vetted. At this point, Trump can and does say anything.
FED SURVEY
Prediction markets
currently see a high probability of Hillary
April 30,
Clinton heading to the White House. However, in this scenario, it
is also likely that the GOP retains the House of Representatives
with a risk of losing the Senate. Given the longer-run budget
challenges facing the US along with rising odds of US recession in
the next four years, the political climate in the next government
could bring serious questions to the popular Wall Street adage
that "gridlock is good."
Clinton is only good for the stock market if Republicans maintain
control of the House and the Clinton/Ryan combo works as well as
Bill Clinton/Newt Gingrich combo did.
In the majority of presidential years the stock market has been
flat to down in the first half-year and rises in the second half.
Trump's most powerful pro-growth policy is his own exuberance
and pride in his own success. "Yes, I'm a billionaire. I did build
that. You can be a billionaire, too."

CNBC Fed Survey March 15, 2016

Page 12 of 30

FED SURVEY
March 15, 2016
11.
Where do you expect the S&P 500 stock index will
be on ?

FED SURVEY
December 31, 2016
April 30,

2,350

2311

2,300

2296

2,250

2247

December 31, 2017

2293

2259

2254

2223

2200

2,200

2166

2,150

2158

2159
2140

2,100

2088

2107
2035

2,050

2,000

2000
1,950

1,900

1,850

1,800
Dec Jan 27 Mar
16
'15
17

April Jun 16 Jul 28 Sept Oct 27 Dec Jan 15 Jan 26 Mar

28
16
15
'16
15
Survey Dates

CNBC Fed Survey March 15, 2016

Page 13 of 30

FED SURVEY
March 15, 2016
12.
What do you expect the yield on the 10-year
Treasury note will be on ?

FED SURVEY
December 31, 2016

December 31, 2017

April 30,
4.0%

3.52%

3.5%

3.24%
3.17%

3.14%

3.0%

3.09%

3.04%

2.88%
2.89%

2.88%

2.83%

2.67% 2.67%
2.5%
2.51%
2.34%

2.0%
Dec 16 Jan 27 Mar 17 April
'15
28

Jul 16 Jul 28
Survey Dates

CNBC Fed Survey March 15, 2016

Page 14 of 30

Sept Oct 27 Dec 15 Jan 26 Mar 15

16
'16

FED SURVEY
March 15, 2016
13.
Where do you expect the fed funds target rate will
be on ?

FED SURVEY
Dec 31, 2016

Dec 31, 2017

April 30,

2.5%

2.13%
1.99%

2.04%
1.93%

2.0%

1.84%

1.75%

1.62%

1.56%

1.61%

1.5%

1.41%

1.61%

1.60%

1.46%
1.17%

1.12%

1.0%

0.88%
0.91% 0.90%
0.85%

0.84%

0.5%

0.0%
Aug Sep Oct Dec Jan Mar April Jun
20 16 28 16 27, 17 28 16
'15

CNBC Fed Survey March 15, 2016

Page 15 of 30

Jul Aug Sept Oct Dec Jan Jan Mar

28 25 16 27 15 15 26 15
'16

FED SURVEY
March 15, 2016
14.
At what fed funds level will the Federal Reserve stop
hiking rates in the current cycle? That is, what will be the
SURVEY
terminalFED
rate?
April 30,
4.0%

3.5%
3.30%
3.20%

3.16%

3.17%
3.11%
3.04%

3.06%

3.0%

2.85%

2.98%

2.79%
2.69%
2.65%
2.58%

2.5%

2.73%

2.56%

2.0%
Aug Sep Oct Dec Jan Mar Apr Jun Jul Aug Sept Oct Dec Jan Mar
20 16 28 16 27, 17 28 16 28 25 16 27 15 26 15
'15
'16
Survey Dates

CNBC Fed Survey March 15, 2016

Page 16 of 30

FED SURVEY
March 15, 2016
15.
When do you believe fed funds will reach its
terminal rate?

FED SURVEY

Survey Date

Forecast

August 20 survey

Q4 2017

September 16 survey

Q3 2017

October 28 survey

Q4 2017

December 16 survey

Q1 2018

Jan. 27, 2015 survey

Q1 2018

March 17 survey

Q4 2017

April 28 survey

Q1 2018

June 16 survey

Q1 2018

July 28 survey

Q2 2018

August 25 survey

Q3 2018

September 16 survey

Q1 2018

October 27 survey

Q3 2018

December 15 survey

Q1 2018

Jan. 26, 2016 survey

Q2 2018

Mar 15 survey

Q3 2018

April 30,

CNBC Fed Survey March 15, 2016

Page 17 of 30

FED SURVEY
March 15, 2016
16.
What is your forecast for the year-over-year
percentage change in real U.S. GDP for ?

FED SURVEY
April 30,

2016

2017

3.0%

2.9%

+2.88%
+2.84%

+2.81%
+2.78%

2.8%
+2.80%

+2.70%

2.7%

+2.64%

+2.60%

2.6%

2.5%
+2.43%

+2.45%

+2.41%

2.4%

2.3%

+2.31%

2.2%

+2.17%

2.1%
Dec 16

Jan 27,
'15

Mar 17

April 28

Jun 16

Jul 28

Sept 16

Oct 27

Dec 15

Jan 26
'16

+2.14%

Mar 15

2016 +2.88% +2.80% +2.84% +2.81% +2.78% +2.70% +2.64% +2.60% +2.45% +2.17% +2.14%
2017

CNBC Fed Survey March 15, 2016

Page 18 of 30

+2.43% +2.31% +2.41%

FED SURVEY
March 15, 2016
17.
What is your forecast for the year-over-year
percentage change in the headline U.S. CPI for ?

FED SURVEY

2016

April 30,

2017

2.4%

2.17%
2.24%
2.2%

2.17%

2.17%

2.12%

2.07% 2.08%

2.07%

2.0%
1.89%

1.96%

1.88%

1.8%
1.75%

1.72%

1.6%

1.50%
1.4%

1.2%

1.0%
Dec 16 Jan 27, Mar 17 April Jun 16 Jul 28
'15
28
Survey Dates

CNBC Fed Survey March 15, 2016

Page 19 of 30

Sept Oct 27 Dec 15 Jan 26 Mar 15

16
'16

FED SURVEY
March 15, 2016
18.
When do you expect the Fed to allow its balance
sheet to decline?

FED SURVEY

AprilDate
30,
Survey

Balance Sheet
Average Forecast

April 28, 2014 survey

October 2015

June 4 survey

March 2016

July 29 survey

December 2015

September 16 survey

December 2015

October 28 survey

January 2016

December 16 survey

February 2016

Jan. 27, 2015 survey

April 2016

March 17 survey

April 2016

April 28 survey

May 2016

June 16 survey

July 2016

July 28 survey

June 2016

August 25 survey

September 2016

September 16 survey

August 2016

October 27 survey

November 2016

December 15 survey

December 2016

Jan. 26, 2016 survey

February 2017

March 15 survey

February 2017

CNBC Fed Survey March 15, 2016

Page 20 of 30

FED SURVEY
March 15, 2016
19.
How would you characterize the Fed's monetary
policy?

FED SURVEY

Too accommodative

Just right

April 30,

Too restrictive

Don't know/unsure

70%
64%

60%

60%

Too accomodative
54%
49% 49% 49% 49%

50%

43%

50%

49%
49%

44% 47%

47%

46%

46%

43% 44%

43%

40%

50% 50%

54%

39%
33%

35%

32%

32%

30%

36% 36%

Just right

28%

23%
20%

17%
13%
Don't know/unsure

10% 13%

8%

6%

6% 5% 6%
3%

6%

Jul
31,
'12

Jul
29,
'14

Aug
20

Sep
16

Oct
28

Dec
16

CNBC Fed Survey March 15, 2016

Page 21 of 30

10%

8%
6%

3%

3%

5%

Jan
27,
'15

Mar
17

8%

6%

4% 5%
Too restrictive

3% 3% 3% 3%

0%

10%

10%

Apr
28

Jun Jul 28 Sept

16
16

Oct
27

5% 5%
Dec
Jan
Mar
15 26 '16 15

FED SURVEY
March 15, 2016
20.
The Federal Reserve's December interest rate hike
was:

FED SURVEY

100%

April 30,

80%

80%

82%

Jan 26

Mar 15

60%
40%

15%

20%

18%
5%

0%
A mistake

The right move

0%

Don't know/unsure

(For those answering a mistake) Why was it a mistake?

100%
80%
60%

57%

50%
33%

40%

29%
14%

20%

17%

0%

Negative effect on stocks

Negative effect on
economic growth

Other

Other answers:

Because there was no sensible reason for it. Revealed the Fed as brain-dead.

Nominal growth is too weak

inflation call was wrong and that influenced their behavior

It was out of sync with the Fed's own reasoning about why it would hike rates and now that is clear.

CNBC Fed Survey March 15, 2016

Page 22 of 30

FED SURVEY
March 15, 2016

20%
15%
8%
4%
8%
5%
7%
10%
3%
12%
6%
31%
40%
0%
6%
3%
3%
6%
0%
0%
0%
0%
5%

31%
28%
30%
27%
29%
32%
21%
23%
26%
29%
26%
18%
14%
13%
14%
11%
17%
21%
16%
8%
10%
10%
21%

20%
20%
22%
22%
24%
29%
30%
26%
21%
12%
29%
15%
14%
9%
0%
8%
3%
9%
2%
5%
5%
5%
3%

0%
3%
0%
2%
3%
2%
2%
3%
3%
6%
6%
3%
3%
0%
3%
3%
0%
0%
0%
3%
0%
0%
0%

2%
3%
2%
0%
3%
0%
0%
5%
5%
3%
3%
3%
6%
0%
6%
0%
0%
0%
4%
8%
0%
3%
0%

2%
0%
2%
4%
3%
2%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%

10%
18%
8%
15%
12%
5%
8%
12%
6%
10%
3%
6%
6%
6%
14%
12%
0%
8%
8%
0%
5%

18%
12%
11%
8%
14%
16%
8%
11%
25%
6%
8%
13%
10%
5%
5%

41%
28%
28%
22%
29%
45%
41%
44%
44%
33%

6%
17%
8%
6%
9%
8%
10%
5%
8%
5%

3%
0%
0%

3%

11%
13%
14%
7%
13%
2%
21%
18%
13%
12%
11%
8%
3%
16%
14%
19%
11%
9%
14%
5%
15%
23%
21%

Other responses:

China hard landing

Exaggerated fears that are alarming the public
HY bond spreads (tightening in fin. conditions)
Rising wage growth combined with low
productivity
The Federal Reserve
Policy mistakes here or abroad
Inadequate monetary stimulus, leading to weak
nominal and real growth, fostering political
upheaval

CNBC Fed Survey March 15, 2016

Page 23 of 30

Fear. Fear that what policy officials are doing

about the globe signifies that the global
economy is very bad and that if we do have a
recession since policy has not been
normalized it will be perceived as spent and
nobody can do anything at this point to help
alleviate a recession. If fear over this issue
becomes pronounced enough, private
economic and investment behaviors could turn
extremely cautious, creating a recession.

Don't know/
unsure

Other

Outcome of US
presidential election

Terrorist attacks in the

U.S.

Slow wage growth

Global econ weakness

Debt ceiling

Deflation

Inflation

Slow job growth

Survey
Date
Apr 30
Jun 18
Jul 30
Sep 17
Oct 29
Dec 17
Jan 28 '14
Mar 18
Apr 28
Jul 29
Sep 16
Oct 28
Dec 16
Jan 27 '15
Mar 17
April 28
Jun 16
Jul 28
Sept 16
Oct 27
Dec 15
Jan 26 '16
Mar 15

Tax/
regulatory policies

April 30,

Geopolitical risks

European recession/
financial crisis

FED SURVEY

Rise in interest rates

21.
What is the single biggest threat facing the U.S.
economic recovery?

0%
0%
4%
2%
0%
2%
0%
0%
0%
3%
3%
3%
0%
0%
0%
3%
0%
0%
2%
0%
0%
3%
0%

FED SURVEY
March 15, 2016
22.
In the next 12 months, what percent probability do
you place on the U.S. entering recession? (0%=No
FED
SURVEY
chance of
recession,
100%=Certainty of recession)
April 30,
40%

36.1%

35%
34.0%

30%

28.8%

28.5%

26.0%

25%

25.9%

24.4%

25.5%
22.9%

24.1%

22.1%

20%

20.6%
20.3%

20.4%
18.4%

18.2%
19.1%
17.6%

16.9%

15%

18.6%

17.3%
16.9%
16.2%

16.2%
15.2%

16.4%

17.4%

15.1%
15.3%
15.0%
14.6%

15.1%
14.7%

13.6%
13.0%

10%

Aug
Sep Oct
11,
19 31
'11

Jan
Mar Apr
23,
16 24
'12

Jul
31

Jan
Sep Dec
Mar Apr
29,
12 11
19 30
'13

Jun
18

Jul
30

Sep Oct Dec

6
29 17

Jan
Mar Apr
28
18 28
'14

Jul
29

Sep Oct Dec

16 28 16

Jan
Mar April Jun
27
17 28 16
'15

Jul Sept Oct Dec

28 16 27 15

Jan
15
'16

Jan Mar
26 15

Series1 34.0 36.1 25.5 20.3 19.1 20.6 25.9 26.0 28.5 20.4 17.6 18.2 15.2 16.2 16.9 18.4 17.3 15.3 16.9 14.6 16.2 15.0 15.1 13.6 13.0 16.4 14.7 15.1 17.4 18.6 22.1 22.9 28.8 24.1 24.4

Survey Dates

CNBC Fed Survey March 15, 2016

Page 24 of 30

FED SURVEY
March 15, 2016
23.

What is your primary area of interest?

FED SURVEY
April 30,
Other
23%
Currencies
0%
Fixed Income
13%

Economics
48%

Equities
18%

Comments:
John Augustine, The Huntington National Bank: NIRP has yet to
prove anything positive.
Jim Bianco, Bianco Research: I'm worried a contested convention,
should it happen, will be very bad for democracy and the economy.
I hope it doesn't happen.
Peter Boockvar, The Lindsey Group: We've reached the end of
the road, not in what central banks can do, but of the influence over
the things they are trying to impact. The effectiveness of modern
day central bank activism is over.

CNBC Fed Survey March 15, 2016

Page 25 of 30

FED SURVEY
March 15, 2016
Robert Brusca, Fact and Opinion Economics: The Fed is torn
over the right course of action. The FOMC soon will have dissenters,
FED
then Fed policy
will SURVEY
become more of a negative for the outlook.
April 30,
Yellen will be unable
to hold this fragile alliance on the statement
together.
Thomas Costerg, Standard Chartered Bank: Elevated high-yield
bond spreads remain a crucial threat to US growth. We also think the
market may under-estimate the negative ramifications of the energy
sector's difficulties. Even if the Fed may sound hawkish in the near
term, we think closer to the June meeting it will again prefer to play
it safe and keep rates on hold. We do not think the Fed will hike
rates this year. In fact the next move may be a cut rather than a
hike, in our view.
Tony Crescenzi, PIMCO: Central bankers are in the midst of an
important pivot, ostensibly agreeing at the recent G20 meeting in
Shanghai to a ceasefire in their global currency war by shifting their
focus away from negative interest rates toward credit easing. This
will not only aid credit instruments, it is likely to enable the Fed to
implement additional interest rate hikes, albeit gradually, because it
is contributing to a stabilization in global financial conditions.
Neil Dutta, Renaissance Macro Research: Since the last FOMC
meeting, US GDP tracking estimates have moved up, the
unemployment rate has ticked down, core inflation has firmed, the
USD has sold off, and broader financial conditions have eased
modestly. Still, the Fed is acting as an automatic stabilizer at the
moment, delaying given the fragility of financial markets. It will take
a few more months to determine whether the weakness in markets
reflects weakness in the real economy. We're doubtful this is the
case. Delays in March and April will be tactical in nature; the case for
gradual rate hikes remains in place.

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FED SURVEY
March 15, 2016
Robert Fry, Robert Fry Economics: When the Fed promised to
keep rates low for an extended period, they gave potential
FED SURVEY permission to sit on the fence and
borrowers/investors/homebuyers
April
30,
wait. When they
suggested
in December that they would raise the
fed funds rate 4 times in 2016, they freaked out the financial
markets. The biggest problem with monetary policy isn't the level of
interest rates; it's the forward guidance.
Kevin Giddis, Raymond James/Morgan Keegan: The Fed needs
to lead the conversation on monetary policy and get its credibility
back, which is needed to restore the market's confidence in the
FOMC's ability to rely first on the data, and not their "hunch" that
inflation is around the corner. They need not make that mistake
again.
Art Hogan, Wunderlich Securities: The Fed has done a good job
walking back the 4 in 2016 narrative and moving us from calendar
dependence to data dependence. The Fed should throw away their
calendar and always be data dependent.
John Kattar, Ardent Asset Advisors: The Fed bought themselves
some credibility with the last hike. Despite some good news on jobs
and the recent rally in stocks, there is still plenty to worry about.
The Fed can afford to pause and wait for more data.
Jack Kleinhenz, Kleinhenz Associates: While the world
economies and the associated mood over the last 6 weeks have
created doubt about the strength of the US economy, recent data
suggests otherwise and the outlook should remain positive.
Consumer spending is off on a strong start this year. Housing should
get the benefit of better labor market and growing incomes.
Nevertheless, voting members of the FOMC will remain in a holding
pattern until some of the world worries have been reduced.

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FED SURVEY
March 15, 2016
David Kotok, Cumberland Advisors: Remarkable times when 1/4
of world real output is housed in 23 countries with NIRP policy.
SURVEYthe power of NIRP on asset prices.
Market agentsFED
underestimate
April
30,
Central bankers
overestimate
NIRP power on growth and inflation.
Subodh Kumar, Subodh Kumar & Associates: Chronic challenges
exist in the Middle East and about North Korea. Other confluences
loom in the ides of March 2016 from both central banks and politics
worldwide. We see global harbingers of market volatility being the
failure of currencies from the euro to the yen to the renminbi to
behave as authorities indicated; the structure in fixed income,
especially of spreads; the highly jagged commodity pricing and
ranged momentum behavior in equities. After being quantitative
ease centric, change looms and better balance is required between
value and momentum across capital markets, an issue neither
investors nor authorities should ignore.
Guy LeBas, Janney Montgomery Scott: Job markets say hike.
Inflation says don't hike. Stock markets say can't hike. Policymakers
are confronted with a series of contradictory signals, all at a time
when monetary policy is becoming less helpful for the real economy.
Ward McCarthy, Jefferies: The primary feature of the US economy
is resilience because it is consumer-driven and 85% of households
are employed in the service sector.
Rob Morgan, Sethi Financial Group: The Fed has made it clear it
will raise rates four times in 2016. I don't believe it will, but if it
doesnt raise rates at the March meeting it makes the 4 hikes in
2016 target a bit harder to believe.
Joel Naroff, Naroff Economic Advisors: Once people stop
focusing on the equity markets they will realize the U.S. economy is
in good shape and wages and prices are rising faster.

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FED SURVEY
March 15, 2016
James Paulsen, Wells Capital Management: What the global
economy needs right now are leaders/policy officials who illustrate
SURVEY
confidence in FED
the free
private capitalistic system by stopping the
Aprilof30,
prolific expansion
experimental economic treatments and thereby
implicitly suggest that Adam Smith, if left alone, will probably
succeed from here in bringing about a desired result. We need for
our policy officials to communicate confidence rather than allow their
collective actions to exhibit fear.
Lynn Reaser, Point Loma Nazarene University: Negative
interest rates represent a genie that should be put back in the bottle.
The transmission channels are not working and are in fact backfiring.
For example, in Japan, the yen is higher, stock prices are lower, and
pressure on bank profits is stifling borrowing.
John Roberts, Hilliard Lyons: Beyond global economic weakness
we worry political rhetoric and the outcome of the presidential
election could negatively impact the market, as investors never like
uncertainty. Political polarization is certainly not positive for the
equity markets.
Merrill Ross, Wunderlich: No central bank has yet successfully
lifted off the zero bound. I believe this is because of the lack of
synchronicity in the economic direction among large and influential
countries.
John Ryding, RDQ Economics: The Fed has botched its
communications policy. Rising core inflation and falling
unemployment should have a data dependent Fed raising rates next
week. It is unlikely to. Communications are a mess.
Allen Sinai, Decision Economics: Markets have overreacted far
too much to recession risks. Just the opposite is in process.

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FED SURVEY
March 15, 2016
Stephen Stanley, Pierpont Securities: The FOMC has been
excessively sensitive to financial market swings and is falling
FED SURVEY
increasingly behind
the curve.
April 30,
Peter Tanous, Lynx Investment Advisory: A President Trump
would tackle our infrastructure needs with gusto. He would embark
on a massive building and rebuilding program that would boost the
economy. He will build beautiful roads, bridges, tunnels and even
walls. And at every ribbon cutting, there would be lines around the
block to get it.
Scott Wren, Wells Fargo Investment Institute: The ECB's
actions this morning are exactly what we thought would
happen....but over time. Rather than trickle these actions slowly
into the market over a period of multiple meetings, they decided to
do in one fell swoop what we and some in the market expected them
to do in aggregate. We have been telling our clients to not doubt the
resolve of the world's major central banks to pull out all the stops in
their attempt to push inflation and economic growth higher. More
major global central bank action is almost surely to follow in the
nearer term. In the immediate wake of the ECB announcement it
was "risk on" around the globe. Now the market is debating whether
this was a desperation move by the ECB. We do not view this as
desperation but basically as taking a bold step to do what they knew
had to eventually occur.
Clare Zempel, Zempel Strategic: Pay more attention to the
"market monetarist's" viewpoint.

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