Tag: "QE3"

The FOMC Doubles-Down ON QE3

Well, the Fed did what I expected it to do (see previous post), but it didn’t wait until after the fiscal cliff negotiations had been completed as I had hoped it would. My fear was that the politicians would take too much comfort in the Fed’s support of the economy and lose some of the […]

Hello QE3

Well, we have it now. The FOMC has promised (or threatened, depending on your viewpoint) to: –Extend the low-interest policy through mid-2015 –Purchase $40 billion of agency MBS per month indefinitely –Confirm “Operation Twist” to year-end –Continue its easy policy well into the eventual recovery period The most significant part of the program is its […]

Back To Jackson Hole

I went back to Jackson Hole again this summer, twice actually. I took family the first time since most had never been. My second trip, I took alone. My objectives were to get out of the unbearable Dallas heat, take long bike rides and moderately long hikes to lose a few pounds. The local scales […]

QE3?

Arguments for: The dual mandate is getting lopsided. Inflation is low and falling; employment growth has stalled, and the unemployment rate is stuck above 8 %. Whatever trade-off or balance before, it has tipped recently. We may have a double dip. We are on the verge of the third consecutive weak GDP quarter, if you […]

The FOMC’s Options

When I was on the FOMC (1991-2004), I arrived at the meetings with “soft conclusions” formed. By that I meant I went in with my preferences, but with a mind open enough to be persuaded otherwise. Tonight, my conclusions are softer than usual, but here is the context of tomorrow’s FOMC decision as I see […]

Sterilizing QE3

I find bizarre reports that Federal Reserve policymakers are considering sterilizing a new round of bond purchases in order to “subdue worries” about potential inflation. Here’s how the WSJ put it in the first two paragraphs of its story on March 8: “Federal Reserve officials are considering a new type of bond buying program designed […]