Fed Rate decision today

Stocks rose Tuesday, even after dismal reports on CPI and housing starts, as investors hope for new direction from the Federal Reserve when the central bank delivers its decision on interest rates today.
Major U.S. Indexes.DJIA8675.48110.95+1.3%471,794,000.NCOMP1544.3636.02+2.39%335,382,500.SPX884.0415.47+1.78%1,846,292,900
Goldman Sachs [GS 74.37 7.91 (+11.9%) ] reported a quarterly loss of $4.97 a share, well off the $3.73-per-share loss expected. Still, its shares rose about 5 percent.
Morgan Stanley [MS 14.94 1.30 (+9.54%) ] reports earnings on Wednesday; analysts expect a loss of 34 cents a share, according to Thomson Financial.
"Expectations are very low for the sector today and that may mean there's some kind of a floor set here," Robert Lutts, chief investment officer at Cabot Money Management in Salem, Mass., told Reuters.
Citigroup [C 7.80 0.40 (+5.41%) ] shares rose after the bank said it was going to sell its Japan trust banking unit.

Bank of America [BAC 13.77 -0.34 (-2.41%) ] shares ticked higher, even after Friedman, Billings, Ramsey slapped the stock with an "underperform" rating, saying the bank's equity ratio is too low and that it will have to raise a "substantial" amount of capital, which would dilute existing shareholder value.

On the economic front, housing starts plunged 18.9 percent last month to a record low annual rate of 625,000 units, as building permits dropped 15.6 percent.

Consumer prices tumbled 1.7 percent in November, the second straight record drop, amid a 17-percent decline in energy costs. Excluding volatile food and energy prices, core CPI was flat.

>> CPI Breakdown: Where prices are rising—and falling

But the market isn't really worried about inflation data, it's preoccupied with what the Fed's going to say today.

Analysts expect the Fed to slash its target for the federal-funds rate by half a percentage point, which would bring the rate close to zero.

And, while the language in the accompanying statement is always closely watched, it's not about the syntax on economic growth or inflation today — it's about what the Fed will say it plans to do, besides slashing interest rates, about the economic slump.

Market watchers are hoping the Fed signals plans for quantitative easing measures, which essentially involves printing more money, to restore growth and signal an end to the ongoing recession.

The typical market response is to rally into the news and top out on the announcement. It wouldn't surprise me if that happened today. Just another faliure on the Wall of Worry. You know woe is me it's hopeless. Well it isn't but as long as we work our way higher it will seem that way. Regardless of the reaction today I think we go higher in the future. I am staying long my positions. Mikey