Party is still on .......

House OKs 'clean' debt limit

WASHINGTON - The House of Representatives approved a one-year extension of federal borrowing authority after Republicans caved into President Barack Obama's demands to allow a debt limit increase without any conditions.

Janet Yellen in Her Testimony 

Her testimony reinforces the view that Janet Yellen is a dove – meaning she leans toward easy money policies to address low inflation and high unemployment. Most notably, she is very focused on the weak job market, which she turns to on page one of her testimony. “The recovery in the labor market is far from complete,” she says. She is looking beyond a 6.6% jobless rate in making this assessment. “Those out of a job for more than six months continue to make up an unusually large fraction of the unemployed,” she says, and “the number of people who are working part-time but would prefer a full-time job remains very high.”

DOESN’T ACCEPT BLAME FOR LATEST EMERGING MARKET SELLOFF: In a section in its official report to Congress, the Fed accepts that talk of pulling back on its bond-buying program last summer triggered stress in emerging markets. But officials don’t accept that the latest round of selling is due to the Fed. “Rather, a few adverse development – including a weaker-than-expected reading on Chinese manufacturing, a devaluation of the Argentine peso, and Turkey’s intervention to support its currency-triggered renewed turbulence in emerging markets, the Fed said. In her testimony, Ms. Yellen said this doesn’t yet look like a threat to the U.S. economy. But the Fed warns in its report that a number of emerging markets, “harbor significant economic and financial vulnerabilities.” An index of vulnerability presented in this report (Page 29) highlights Turkey, Brazil, India, Indonesia and South Africa as among the most vulnerable.