Tread lightly into the throes of Fedspeak for first comes the FOMC statement a 1 p.m. CST followed by the last press conference of Chairman Bernanke’s term at 1:30 p.m. The markets are going to be volatile as confusion reigns in all asset classes. Today, the Treasury market was trying to reassert a steepening bias into the 5/30 yield curve as the FIVES were strong and the 30-YEAR YIELDS were rising. However, by day’s end the 5/30 retraced and closed unchanged on the day (if you trade the curve in futures terms the ratio is almost three FIVES to one THIRTY-year bond). Consensus has changed and the bias is for a tapering the question is: HOW LARGE? I have assumed a $20 billion tapering and I will stick with that “bold” conjecture. It is important to listen for any language of forward guidance on the unemployment threshold for if the Fed were to hint at lowering the 6.5% threshold, markets will reverse course, especially the S&Ps and DOW, which have spent the last few days in correction mode.