Good morning. I wonder if someone has the Fed meeting bugged. I mean for the last week and a day the equity market were lackluster chopping around looking for direction. That was the way we started out the day yesterday trading on either side of unchanged until about 10:20 CDT and then zoom, off to the races, particularly between 10:20 and 11:25. The Fed began its two day meeting yesterday and concludes it today with Janet Yellen having a press conference this afternoon. Maybe someone bugged the room and heard that the words “considerable time” will not be dropped from the Fed’s post meeting communique. Regardless of the rhetoric, our economy continues to show strength. Not in leaps and bounds but in a steady, slow grind. It’s still a bull market amigos. On the day the Dow added a very nice 101 points to 17,132, the S&P 500 climbed 15 to 1,999, and oh so close to getting back over the 2,000 mark, and the Nasdaq, which got bludgeoned yesterday, rose 34 points to 4,553. It’s very possible that crude oil prices, which jumped yesterday (more on that below) brought buyers into the stocks of oil and gas producers which goosed the entire market. Energy stocks rose 1.2%.

This morning is a repeat of what the pattern has been for the last week and a half, chatter. Dow up 17. All eyes and ears are looking to Janet Yellen and the Fed with the market wondering if the Fed will continue to leave interest rates unchanged for a “considerable time.” A Wall Street Journal reporter who has a reputation of being the Delphic Oracle of the Federal Reserve System, i.e., the “receiver” of information the Fed wants to “leak” to the market, stated in a webcast yesterday he believed the Fed would leave the two words in its communique but qualify the words saying the Fed would announce a formalized plan to exit their QE, i.e., raise interest rates.

Tomorrow is a big day for the UK (no, not for the Jayhawks!) with the Scots going to the polls to vote on a referendum on independence. Late last week polls were showing it was a toss-up but it looks like the “No’s” will prevail and Scotland will remain within the UK to the relief of the UK business community and especially David Cameron, the Prime Minister of the UK, who would in all likelihood lose his prestigious job if the “Yes’” prevailed.

After getting pounded for the last three months oil rallied hard yesterday with WTI rising $1.96, 2.1%, closing at $94.88 and Brent gaining $1.17, 1.2%, settling at $99.04. This was WTI’s highest close in nearly 2.5 months. So what the heck happened? Well it looks like the OPEC had enough of falling prices. Yesterday its Secretary General, Abdalla el-Badri, said he expects the organization to lower its output target for 2015 by 500,000 barrels to 29.5 million bpd. This falls on the Saudis because no other country will cut production. The Saudi’s have been relegated to be the swing producer. I also believe yesterday’s hard up move was the result of an oversold market with shorts running to cover. Like I said, expect for 5 up days in July WTI has fallen for 3 months. This morning like equities WTI is basically unchanged, down a meaningless 2¢.

Natural gas continues to grind higher. After hitting a low of $3.724 both in July and August natty is now at $3.995 which includes yesterday’s gain of 6.4¢. And with this morning’s gain of 1.5¢ we’re back over $4.00. The bulls have and are definitely pushing the bears back into their caves. Over the last month more and more weather forecasts are being published predicting a colder than normal winter for the Midwest. This is most definitely making the shorts nervous. Now no one is predicting a winter as cold as last record, i.e. record setting, but people’s memories are long. Last January’s prices of $25/MMBtu in Chicago and $40/MMBtu in Boston are still fresh in traders’ minds. That one month wiped out an entire year of profits for some companies. You don’t forget that quickly. It appears traders are starting to look past the fall and are starting to trade the winter.

It’s interesting that natty is up this morning and not down because the weather forecast has definitely moderated for the 11-15 day time frame, particularly for PA and New England. In fact for that time frame there’s very little natural gas load east of the Rockies. That being said, heaters will definitely be kicking on at night in the 6-10 day time frame.

If you can’t beat ‘em, pay ‘em! As a matter of background, there has been social conflict in a far western province in China, the Xinjiang province. This province is predominantly Muslim (the folks there are known as Uighurs (pronounced Wee-gar) and have been giving Beijing a good deal of trouble. In an attempt to reduce the problems there and assimilate the Uighurs into modern Han society, the largest ethnic group in China, the government came up with a plan. Have them marry! So you’re thinking, “Right. Like that’s going to happen!” Ah but they might if you pay them to! Apparently the Chinese government will pay $1,600/yr (U.S. equivalent) for five years to newly married couples in which one of the members is Han and the other is one or more than 50 ethnic groups in China, including the Uighurs. Further these couples will be given preference for jobs in Xinjiang. Additionally, they will receive another $3,200 annually in health care and other benefits and their children will have much of their educations paid for by the government. As Den Xiaoping, the man responsible for opening up China, said, this is “Communism with a Chinese face.” Sounds like capitalism to me. Have a good day.