The Federal Reserve issued their statement for September today and most on Wall Street found the statement to be a quite optimistic. For the first time since August 2008 the FOMC indicated that it sees the economy accelerating, albeit at a slower pace than they would like. Maybe the biggest news out of today’s statement came from the fact that the Federal Reserve will slow its mortgage securities purchasing program to avoid disrupting the housing market as the economy starts to recover. The Federal Reserve says they anticipate finishing the program by first quarter of 2010.

While the FOMC definitely sounded more positive today, they indicated that they will be keeping rates historically low for an extended period of time, hoping to boost economic growth going forward. The goal of the Federal Reserve at this point seems to be to wind down their programs that have boosted the economy, but do so at a pace that doesn’t upset market conditions or slow any potential progress that will be made in the future. The Federal Reserve announced last month that it would be finishing off its program of buying treasury securities and now it is stating that it will tiptoe out of the mortgage securities purchases as well.

Initially stocks rose to their highest levels of the year after the announcement, but by the end of the trading day the stock market had settled lower after investors decided to take profits following a very nice run in the market over the last few months. Clearly the stock market is starting to expect a recovery and the language from the Federal Reserve has improved quite drastically over the past few months. The main thing that the economy and consumers need now is businesses to start hiring once again and the unemployment rate to begin to fall.