Been down so long this looks like up to me

Want to know how far the financial markets have swung toward fear of the fiscal cliff this week? Notice that all it took to turn the U.S. stock market indexes around this morning was some vague optimism expressed after a meeting convened by the White House. The Standard & Poor’s 500 stock index, which had tumbled to 1344 had recovered to 1360 as of 1 p.m. New York time.

Continued subdued inflation gives the Fed no reason to change current monetary policy

The headline Consumer Price Index (CPI) rose by 0.1% in October. The core CPI, which excludes energy and food costs, rose by 0.2% in October. For the last 12 months, the headline CPI is up 2.2% and the core CPI is up 2%. The continued very subdued rate of inflation removes any pressure on the Federal Reserve to change its current policy of low interest rates and quantitative easing.

EuroZone meeting ends in chaos but European markets rally on the bad news

Yesterday’s meeting of European finance ministers ended in a complete botch: No approval for the next 31.5 billion euro payout to Greece and public fighting between Eurogroup President Jean-Claude Juncker and International Monetary Fund Director Christine Lagarde. And yet the German DAX stock index finished up (yes UP!) by 0.4%; the French CAC 40 index rose 0.6%, and the Spanish IBEX 35 climbed 1.7%.