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Fed to launch QE3 by buying mortgage securities
Market Watch ^ | 9-13-2012

Posted on 09/13/2012 10:04:23 AM PDT by tapatio

WASHINGTON (MarketWatch) — The Federal Reserve, worried that improvement in the unemployment rate has stalled, announced a third large purchase of bonds on Thursday in an effort to bring down long-term interest rates and spur growth.

(Excerpt) Read more at youtube.com ...


TOPICS: Front Page News; News/Current Events
KEYWORDS:

1 posted on 09/13/2012 10:04:27 AM PDT by tapatio
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To: tapatio

2 posted on 09/13/2012 10:05:26 AM PDT by RckyRaCoCo (I prefer liberty with danger to peace with slavery, IXNAY THE TSA!)
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To: tapatio

So how long will it take to double prices on everything again?


3 posted on 09/13/2012 10:05:59 AM PDT by mountainlion (Live well for those that did not make it back.)
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To: mountainlion

About 10 minutes.


4 posted on 09/13/2012 10:06:34 AM PDT by grobdriver (Proud Member, Party of No! Nobama, No Way, No How!)
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To: tapatio

Excerpt is wrong @ you tube. Please click on Market Watch link. Sorry.


5 posted on 09/13/2012 10:06:49 AM PDT by tapatio (In memory of my Dad 5-27-26 2-4-2010)
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To: tapatio

The Federal Reserve is nothing more than part of our communists leadership. The market soon will crash under it’s fake money and we will be in a depression worst than the thirties>


6 posted on 09/13/2012 10:07:30 AM PDT by Logical me
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To: tapatio

Oh this is gonna be awesome!

Need to put Obama’s head on the body of a Satyr with a pan flute skipping down Pennsylvania Ave engulfed in flames.


7 posted on 09/13/2012 10:07:58 AM PDT by rarestia (It's time to water the Tree of Liberty.)
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To: tapatio

More fuel on the fire.


8 posted on 09/13/2012 10:10:35 AM PDT by Vaduz
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To: tapatio

Because the first bubble burst wasn’t devastating enough?


9 posted on 09/13/2012 10:11:03 AM PDT by liberalh8ter (If Barack has a memory like a steel trap, why can't he remember what the Constitution says?)
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To: tapatio

This is going to end badly.


10 posted on 09/13/2012 10:11:51 AM PDT by Obadiah (The Hunger Games -- Obama's vision for America)
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To: tapatio
Correct me if I'm wrong, but I thought I heard RUSH say Romney asked them not to do this.There's a better way.

Throwing more money at the problem never works, especially since we've already thrown 5 trillion away like trash.

Maybe, just maybe, Oboma is crashing the U.S. economy on purpose - finishing the job his muslim brothers failed to do on 9/11. There's no excuse for him to do so many stupid things without knowing exactly what he's doing.

11 posted on 09/13/2012 10:12:43 AM PDT by concerned about politics ("Get thee behind me, Liberal")
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To: tapatio

12 posted on 09/13/2012 10:13:25 AM PDT by Atlas Sneezed (Hold My Beer and Watch This!)
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To: tapatio
Shouldn't the headline be something like, “Bernanke insures big donors for Obama keep getting raises and bonuses, in order to keep his job”?

This is not going to end well. Not well at all.

13 posted on 09/13/2012 10:13:50 AM PDT by cashless (Unlike Obama and his supporters, I'd rather be a TEA BAGGER than a TEA BAGGEE.)
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To: mountainlion

Just today they raised the price on my daily dose of soda.. yesterday 2 20oz bottles where 2.50.

Today, same 2 20oz bottles 2.75.

FUBO FUBB

But hey, gas went down a penny to 3.98.. so I guess it’s all relative /s


14 posted on 09/13/2012 10:15:00 AM PDT by cableguymn
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To: tapatio
It doesn't work. In some sort of left handed way what is happening is that the Fed is nationalizing the private bank accounts, pensions, and wealth of the citizens.

By printing funny money and causing inflation they are taking the value out of the pockets of the citizenry in an attempt to preserve the status quo.

The economy, which is really the people, are not going to invest in the vision of this brain dead administration. They will hold whatever little wealth they have until they get a government they can trust.

15 posted on 09/13/2012 10:17:11 AM PDT by oldbrowser (An empty chair attracts a stadium full of empty chairs.)
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To: tapatio
When they monetize the federal debt like this, they are essentially stealing all the money from people who save. So you might as well spend all the cash you have now because soon the purchasing power of those dollars will be a fraction of what they are now. I suggest using your cash to buy non perishables like arms and ammunition, buckets of rice, wheat and beans, gold and silver coins etc.
16 posted on 09/13/2012 10:19:03 AM PDT by Flavious_Maximus
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To: cashless
Shouldn't the headline be something like, “Bernanke insures big donors for Obama keep getting raises and bonuses, in order to keep his job”?

Yep!

17 posted on 09/13/2012 10:19:07 AM PDT by tapatio (In memory of my Dad 5-27-26 2-4-2010)
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To: mountainlion
$ 6 for a loaf of bread now ?

Are you better off financially and security wise than you were 4 years ago America ?

HELL NO !
18 posted on 09/13/2012 10:19:20 AM PDT by American Constitutionalist (The fool has said in his heart, " there is no GOD " ..)
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To: tapatio
Hyperinflation is Virtually Assured – John Williams - 9/12/12

The Federal Reserve is talking about “unlimited QE,” or money printing, to boost employment. Economist John Williams says, “That’s absolutely nonsense. The Fed is just propping up the banks.” Williams says, “You’re likely going to see a dollar sell-off . . . That should evolve into hyperinflation.”

Williams, “Doesn’t see the current system holding together without hyperinflation beyond 2014.” He contends the real annual deficit is “$5 trillion per year” and says, “That’s beyond containment.” Williams predicts, “Hyperinflation is virtually assured because the Fed doesn’t have any options left.” Williams says people should get prepared because we are facing a “man-made disaster.”
19 posted on 09/13/2012 10:21:57 AM PDT by onyx (FREE REPUBLIC IS HERE TO STAY! DONATE MONTHLY! IF YOU WANT ON SARAH PALIN''S PING LIST, LET ME KNOW)
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To: oldbrowser
They will hold whatever little wealth they have until they get a government they can trust.

If Oboma manages to get another 4 years, we're going to see a hording of everything. People are going to be digging fox holes everywhere. We have preppers from his first (and hopefully last) 4 years already, but we haven't seen anything yet. 4 more years, and the U.S. is a goner. Oboma will have pulled it off without a niche.

20 posted on 09/13/2012 10:23:21 AM PDT by concerned about politics ("Get thee behind me, Liberal")
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To: tapatio
Printing money is nothing more than a cowardly form of taxation. You rob value from people who hold dollars (by devaluing their currency) and give it to your cronies as crisp new dollars. It is taxation with no vote and no debate. Nobody in the chain is an elected official - just political appointees.

This gets to the core of the corrupting and tyrannical power of fiat currencies and the govts that control them.

21 posted on 09/13/2012 10:24:25 AM PDT by LaserJock
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To: onyx
Williams says people should get prepared because we are facing a “man-made disaster.”

Needs repeating.

22 posted on 09/13/2012 10:25:37 AM PDT by concerned about politics ("Get thee behind me, Liberal")
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To: tapatio

Get ready for fuel prices to go up. That will cause commodities, food and necessities to climb, but the government will conveniently not count that as inflation. Wages won’t go up, but the cost of living will soar, and those who have insurance will pay more for less. QE3 will help the mortgage holders on Wall Street while giving average citizens less money to pay their mortgages.


23 posted on 09/13/2012 10:25:45 AM PDT by pallis
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To: tapatio
Rudyard Kipling, in 1919:

In the Carboniferous Epoch we were promised abundance for all,
By robbing selected Peter to pay for collective Paul;
But, though we had plenty of money, there was nothing our money could buy,
And the Gods of the Copybook Headings said: "If you don't work you die."

24 posted on 09/13/2012 10:26:44 AM PDT by DuncanWaring (The Lord uses the good ones; the bad ones use the Lord.)
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To: cableguymn
But hey, gas went down a penny to 3.98.. so I guess it’s all relative /s

At my local gas station yesterday in The People's Republik of Connecticut, the lowest gas price was $4.11. Unreal.

25 posted on 09/13/2012 10:28:11 AM PDT by nutmeg (I'm with Sarah Palin and Ted Cruz: "ABO"/Ryan 2012)
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To: Beelzebubba

Not surprising ... as the number of dollars in existence approaches infinity, the amount of gold (or anything else) each will buy approaches zero.


26 posted on 09/13/2012 10:28:24 AM PDT by DuncanWaring (The Lord uses the good ones; the bad ones use the Lord.)
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To: pallis
Get ready for fuel prices to go up.

FOX - Out of control Middle East raises fears of oil crises.

Oboma really, really sucks!!!

27 posted on 09/13/2012 10:30:56 AM PDT by concerned about politics ("Get thee behind me, Liberal")
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To: onyx

Another banker bailout. They’re bailed out and keep the notes!

If they had bailed out homeowners instead the economy would have rebounded in response as that is working capital versus (non-performing) debt capital.


28 posted on 09/13/2012 10:32:05 AM PDT by Justa
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To: Beelzebubba
Happy Days everywhere!!

DJIA

29 posted on 09/13/2012 10:34:21 AM PDT by blam
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To: nutmeg
$4.10 per gallon in small town NY. Can't imagine what it is in the bigger cities. They're always higher.

It's hard to imagine under Bush it was only $1.89 and the left was having a heart attack about it. Where are those outraged media pundits now?

30 posted on 09/13/2012 10:34:34 AM PDT by concerned about politics ("Get thee behind me, Liberal")
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To: RckyRaCoCo
QE3 will not improve the dire situation in the labor market. This will only generate more inflation while the labor market continues to stagnate. Hiring in the private sector will not improve until most of Obamacare is repealed and business owners regain control of their health care plans and their health care costs. Right now the health care costs for permanent employees are dictated by the Obamacare bureaucracy in Washington, and that is why business managers are only hiring the best permanent employees that they absolutely must hire to continue running their business in the long term. After hiring those absolutely essential employees, business managers are using technology in creative ways to boost productivity and minimize their total number of employees.

These are the unintended consequences of Obamacare and exactly what I thought would happen before Obamacare was jammed through congress by Obama, Reid, and Pelosi against the will of the American people. If the White House had actually bothered to talk to the business community about health care reform, the democrats would have learned that Obamacare was sure to cause stagnation in hiring and a surge in technology-related investments, which tend to create manufacturing jobs in Asia and not in America.

This Fed action today is futile and will only create stagflation in America. The only way to get the job market and the economy rolling again is to repeal most of Obamacare and return control of health care benefits and health care costs to employers...permanently. All QE3 does is boost demand artificially, but wealth and prosperity are not created by demand, they are created mainly by increasing production and supply. Production and supply are increased by creating incentives for investment and hiring and reducing government regulation and control over the private sector.

All of this was proven conclusively by the colossal economic failure of the Soviet Union and by the massive, long-lasting economy boom generated by Reagan's tax cuts starting in 1981. Unfortunately, democrat political leaders have learned nothing from economic history. QE3 is doomed to fail and will only cause an increase in asset prices, commodity prices, and consumer inflation, while the job market continues to stagnate.

31 posted on 09/13/2012 10:40:22 AM PDT by socialism_stinX (If knowledge is power, then why is the MSM mafia so powerful?)
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To: All
CONGRESSMAN COLLUDED IN THE BILLION DOLLAR SUB-PRIME DEBACLE The Congressional Hispanic Institute, Inc, is an entity organized by Cong Joe Baca (D-Cali) in his capacity as head of the Congressional Hispanic Caucus.

Cong Baca created "HOGAR" (Spanish for home) in 2003 to work with the mortgage industry, lender and banks and latino community groups to increase mortgage lending to what savvy observers considered to be unqualified Latinos.

"HOGAR" colluded w/ Cong BAca in what was to become a massive bilking of taxpayers. Cong Baca calculatedly hyped the fact that the national Latino homeownership rate was 47%, compared with 68% for the overall population.

HOGAR was coached to call the figure "alarming," and to say "a concerted effort was required to ensure that by the end of the decade Latinos will share equally in the American Dream of home ownership."

HOGAR and Cong Baca conned the public, failing to note that most of the "dreamers" were illegals, citizens of Third World countries who had violated US borders.

Predictably, HOGAR colluded w/ co-conspirators which included:

(a) shaky mortgage companies that ran into big trouble;

(b) Fannie Mae and Freddie Mac, both now under federal control after billions in taxpayer bailouts;

(c) Countrywide Financial Corp., sold to Bank of America Corp;

(d) Washington Mutual Inc., taken over by the US government and sold to J.P. Morgan Chase & Co.; and,

(e) New Century Financial Corp. and Ameriquest Mortgage Corp, both now defunct, killed by defaulted subprime Latino mortgages.

HOGAR's ties to the subprime mortgage industry were substantial. Bribery and self-dealing were rampant:

<><> Companies that donated $150,000 to Cong Baca got the right to have their own research fellow who would conduct fraudulent studies, which were cunningly used by industry lobbyists to pump lending.

<><> Bribery and extortion in the form of $100,000 annual donations to Cong Baca, for which HOGAR provided phony news releases from Cong Baca's Hispanic Caucus promoting a lender's commercial products to the Latino market,

<><> The most shocking example of bribery well-substantitated by Hogar's literature..... HOGAR announced it worked with Freddie Mac on a self-serving two-year examination of Latino homeownership in 63 congressional districts.

The "study" found Hispanic ownership on the rise thanks to "new flexible mortgage loan products" that the industry was adopting at the urging of Cong Baca's collusive coterie.

<><> HOGAR conned lenders into even more lenient down-payment and underwriting standards.

<><> As the subprime debacle unfolded, HOGAR declined repeated requests for comment despite the economic havoc their activities precipitated.

The mortgage schemes demonstrated the criminal activities of border violators with multiple identities---perhaps violent, terrorist-connected foreigners---colluding and conspiring to defraud private companies and public entities. And mortgage racketeering enterprises which employed sub rosa finance and business practices to carry out deceptions and frauds.

The alleged ring of swindlers---a Congresman, individuals with multiple identities, banks, insurance companies, mortgage nrokers--might be charged with cheating the US govt, taxpayers and bank share holders out of hundreds of millions of dollars via an elaborate web of mortgage and bank frauds.

The mortgage Dreamers used multiple phony identities, fraudulent Social Security numbers, purchased from identity forgers in order to obtain govt-subsidized benefits.

L/E will find that individuals with multiple identities obtained fraudulent mortgages then flipped the houses at ever-higher prices to family member who then absconded to foreign countries, sticking banks (and taxpayers) with hundreds of millions in fraudulent mortgages.

BACKGROUND A Wall Street Journal investigative report related that, according to the Federal Financial Institutions Examination Council examination of the borrowing spree, uncovered financial schemes by low-income housing groups, Hispanic lawmakers, a congressional Hispanic housing initiative, mortgage lenders and brokers, all colluding in fraduent schemes to increase homeownership among Latinos with forged documents which enabled massive fraud.

This was not simply the mortgage market at work. It was fueled by avarice, greed, and Congressional enabling fraudulent practices. In 2005 alone, mortgages to Hispanics jumped by 29%; Latinos with multiple fraudulent identities in low-paying jobs obtained subprime mortgages for prime properties---soaring to 169%.

(Research provided by Wall Street Journal. Some material excerpted from the NY Times

32 posted on 09/13/2012 10:43:56 AM PDT by Liz ("Come quickly, I'm tasting the stars." Dom Perignon)
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To: tapatio
Bernanke has jumped on board the Reelect Obama Bus.


33 posted on 09/13/2012 10:44:01 AM PDT by Iron Munro ("In any compromise between good and evil, it is only evil that can profit." - Ayn Rand)
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To: All
The Stimulus Bombshell
MyGovCost.org ^ | 1/24/12 | Craig Eyermann
FR Posted January 31, 2012 by GSWarrior

Stunning.

That’s really the only word we can use to describe the release of a “sensitive and confidential” 57 page memo, written by then soon-to-be U.S. Treasury Secretary Larry Summers in December 2008, about what became President Obama’s signature economic program in the first year of his presidency: the “stimulus package”.

James Pethokoukis has summarized some of the most significant aspects of the memo, which we’ve excerpted below, and which reveals the Obama administration’s thinking behind what became an over 821 billion dollar boondoggle. The bold text represents Pethokoukis’ summary of that thinking, which is directly followed by a supporting quotation from Larry Summers’ memo:

1. The stimulus was about implementing the Obama agenda. The short-run economic imperative was to identify as many campaign promises or high priority items that would spend out quickly and be inherently temporary.... The stimulus package is a key tool for advancing clean energy goals and fulfilling a number of campaign commitments.

2. Team Obama knows these deficits are dangerous (although it has offered no long-term plan to deal with them). Closing the gap between what the campaign proposed and the estimates of the campaign offsets would require scaling back proposals by about $100 billion annually or adding new offsets totaling the same. Even this, however, would leave an average deficit over the next decade that would be worse than any post-World War II decade. This would be entirely unsustainable and could cause serious economic problems in the both the short run and the long run.

3. Obamanomics was pricier than advertised. Your campaign proposals add about $100 billion per year to the deficit largely because rescoring indicates that some of your revenue raisers do not raise as much as the campaign assumed and some of your proposals cost more than the campaign assumed.... Treasury estimates that repealing the tax cuts above $250,000 would raise about $40 billion less than the campaign assumed....The health plan is about $10 billion more costly than the campaign estimated and the health savings are about $25 billion lower than the campaign estimated.

4. Even Washington can only spend so much money so fast. Constructing a package of this size, or even in the $500 billion range, is a major challenge. While the most effective stimulus is government investment, it is difficult to identify feasible spending projects on the scale that is needed to stabilize the macroeconomy. Moreover, there is a tension between the need to spend the money quickly and the desire to spend the money wisely. To get the package to the requisite size, and also to address other problems, we recommend combining it with substantial state fiscal relief and tax cuts for individuals and businesses.

5. Liberals can complain about the stimulus having too many tax cuts, but even Team Obama thought more spending was unrealistic.

As noted above, it is not possible to spend out much more than $225 billion in the next two years with high-priority investments and protections for the most vulnerable. This total, however, falls well short of what economists believe is needed for the economy, both in total and especially in 2009. As a result, to achieve our macroeconomic objectives—minimally the 2.5 million job goal—will require other sources of stimulus including state fiscal relief, tax cuts for individuals, or tax cuts for businesses.

6. Team Obama thought a stimulus plan of more than $1 trillion would spook financial markets and send interest rates climbing. To accomplish a more significant reduction in the output gap would require stimulus of well over $1 trillion based on purely mechanical assumptions—which would likely not accomplish the goal because of the impact it would have on markets.

=====================================

2008 Candidate Barack Obama told us on the campaign trail: " The problem is, that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion for the first 42 presidents, # 43 added $4 trillion by his lonesome so that now we have over $9 trillion of debt that we are going to have to pay back, $30,000 for every man woman and child. That’s irresponsible. It’s unpatriotic."

REALITY CHECK Obama presided over the biggest political heist in US history.

The Obamanations (insiders and politicians) sucked up trillions under the guise of inheriting the "Bush financial crisis."

THIS MADE ME LAUGH OUT LOUD Obama COS Rahm Emanuel "suddenly" discovered he wanted to be Chicago's mayor---the little turn went before the mics and announced his campaign "raised $10 million in just a few weeks." Rahm also controlled the US Treasury as COS.

======================================

In a fair accounting, President Obama is responsible (along with the then-Democratic Congress) for the $1.3 trillion in deficit spending in 2010 and the estimated $1.6 trillion in deficit spending in 2011. He [Obama] should not get credit, moreover, for the $149 billion in TARP (Troubled Asset Relief Program) repayments made in 2010 and 2011 to cover most of the $154 billion in bank loans that remained unpaid at the end of the 2009 fiscal year—loans that count against President Bush’s 2009 deficit tally.

The Treasury Department says that all but $5 billion of the TARP bank loans has now been repaid. The portion of repayments that was for loans issued in 2009 should be deducted from Bush’s deficit tally, not credited to Obama as deficit savings. There is some astounding number crunching in this article, and a chart of modern day president’s “average annual deficit spending” ........a frightening conclusion of what happens if Obama has an 8 year term.

graph

34 posted on 09/13/2012 10:48:46 AM PDT by Liz ("Come quickly, I'm tasting the stars." Dom Perignon)
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To: concerned about politics; cableguymn; GOPsterinMA; NautiNurse; StarFan; stanz; Bigg Red; ...
It's hard to imagine under Bush it was only $1.89 and the left was having a heart attack about it. Where are those outraged media pundits now?

Good question. I sometimes post a big sign on the back of my old Toyota station wagon:

Gas was $1.79 a gallon when Obama took office on 1-20-09

I actually found that the lowest-grade price per gallon on 1-20-09 was $1.79 per the following sources:

2012 GasBuddy.com
PolitiFact.com
U.S. Energy Information Administration / Monthly Energy Review 2012

This gas price sign has gotten the most attention of all of the rotating signs I've taped to my car's back window over the years.

Pisses off the Obama lovers BIG TIME. ;-)

35 posted on 09/13/2012 10:53:30 AM PDT by nutmeg (I'm with Sarah Palin and Ted Cruz: "ABO"/Ryan 2012)
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To: American Constitutionalist

$ 6 for a loaf of bread now ?
= = = = = = = = = = = =

NOT to worry.

They probably have the EBT adjusted or COL raise on a weekly basis - or just auto refill when empty.

FREE ICE CREAM!!!!


36 posted on 09/13/2012 10:55:01 AM PDT by xrmusn (6/98 "It is virtually impossible to clean the pond as long as the pigs are still crapping in it")
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To: tapatio

This is how it works:

1. The Fed purchases mortgages with made up monopoly money.

2. They get paid interest on those mortgages with real money.

3. When there is a default on the payments they seize the property.

4. Bottom line: Zero investment, huge takeover of real property.

Question: How can I start a business like this?


37 posted on 09/13/2012 11:08:50 AM PDT by InterceptPoint (.)
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To: Justa
Yep, it's a banker bailout and that's why the stock market is up.

Gold is also up because the smart guys know the value of paper money.


38 posted on 09/13/2012 11:14:18 AM PDT by onyx (FREE REPUBLIC IS HERE TO STAY! DONATE MONTHLY! IF YOU WANT ON SARAH PALIN''S PING LIST, LET ME KNOW)
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To: tapatio

Soon they will be buying subprime Auto Loans.


39 posted on 09/13/2012 1:07:26 PM PDT by stocksthatgoup (Wealth = Net Worth ///// Income = Net Work)
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To: InterceptPoint

It WAS ONLY a Matter of Time * White House Wants to RENT Foreclosed Homes!

Government TAKING privately or BANK OWNED homes is a BAD IDEA on so many fronts.

1st * the homes will never be REsold once tenants are in place.

Government TAKING privately or BANK OWNED homes is a BAD IDEA on so many fronts. 1st * the homes will never be REsold once tenants are in place. This is a GREAT way to create INVENTORY for Section8 or other yet-to-be-named low-income rental housing programs. This will allow the government to create yet another ENTITLEMENT PROGRAM.

2nd * the management of SCATTERED inventory will be a NIGHTMARE (on YOUR street) * sorry Jason.

I was around during the RTC * Resolution Trust Corporation * and received many solicitations for me * a FEMALE owned business * to bid on the management of these government owned properties. The paperwork was HORRENDOUS just to be considered for management. This allowed for many SCAMS in management, rent skimming and repair OVERcharges. Taxpayers will ultimately pay for this poor service just like they have with the deteriorating government owned subsidized housing stock.

3rd * These properties are currently carried on the books of BANKS and MORTGAGE firms.

Somebody will need to PAY “some” value of these ASSETS before they can be utilized in this way. Guess who pays? Guess who gets paid?

4th * These properties will PULL DOWN the values in their neighborhoods.

YES, they will be a shadow inventory or a phantom; however, without PRIDE OF OWNERSHIP or proper maintenance of the exteriors, many neighborhoods will deteriorate FAST as has been seen in Detroit and Atlanta where whole neighborhoods have been razed.

http://activerain.com/blogsview/2417221/it-was-only-a-matter-of-time-white-house-wants-to-rent-foreclosed-homes-


40 posted on 09/13/2012 1:18:45 PM PDT by ilovesarah2012
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