Having heard from the Fed exactly what they expected to - that creeping inflation pressures necessitated a rate hike of a quarter-point (25 BASYS points) but no nudge in the now-neutral bias - the markets may now exhale, slump a little, and get back to fundamentals. "The good news is that Greenspan remains ahead of the curve, acting promptly to hold down inflation just like he said he would," says TIME senior economics reporter Bernard Baumohl. "But the markets had their rally Monday - and most of the time its buy on the rumor, sell on the news." But any bout of post-ratem profit-taking isnt likely to last long - after all, corporate earnings are coming soon (and looking promising). Even better, Greenspan wont be poking his head up again until sometime around Groundhog Day.

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"For the Fed to raise again this year, thered have to be extremely clear signs that the economy was growing too fast," says Baumohl. "He wants to preserve some liquidity for Y2K, and he wants to stay in the background when the political season heats up and everyones fighting about tax cuts." Thats just fine with the markets - they hate politics anyway. The only thing that might have spoiled their party is if Greenspan hadnt raised rates -- good news like that, if its unexpected, can only cause a ruckus. "That would have freaked everybody out, because suddenly he looks like hes behind the curve," says Baumohl. Greenspan, behind the curve? Now that would have been surprising.