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Why Bernanke's Words Don't Matter to Investors

Alex Dumortier, CFA
July 17, 2013

U.S. stocks are little changed this morning as Federal Reserve Chairman Ben Bernanke begins his two-day round of testimony on Capital Hell, with the S&P 500 (INDEX: ^GSPC) and the narrower, price-weighted Dow Jones Industrial Average (INDEX: ^DJI) up 0.28% and 0.1%, respectively, as of 10:10 a.m. EDT.

Everything you need to know about the Fed chairman's testimony
And speaking of Mr. Bernanke's testimony, in yesterday afternoon's commentary, I wrote:

Don't expect any surprises from Bernanke, who will be satisfied to keep hammering his audience with the stance articulated at the last Federal Open Market Committee meeting.

Furthermore, the Fed's policy path will ultimately depend on economic data that isn't available yet -- it's more than likely the central bank does not itself know at this time precisely when or how it will begin tapering its monthly bond purchases (i.e., "quantitative easing").

In his prepared testimony at the hearing before the Committee on Financial Services, which began at 10 a.m. EDT, Bernanke reiterated the provisional "taper" calendar the Fed laid out last month, according to which it would begin to reduce its monthly bond purchases later this year before ending them roughly midway through 2014. However, he was careful to qualify