Skip to comments.Fed Undertakes QE3 With $40 Billion MBS Purchases Per Month
Posted on 09/13/2012 3:12:59 PM PDT by SeekAndFind
The Federal Reserve said it will expand its holdings of long-term securities with open-ended purchases of $40 billion of mortgage debt a month in a third round of quantitative easing as it seeks to boost growth and reduce unemployment.
Were looking for ongoing, sustained improvement in the labor market, Chairman Ben S. Bernanke said in his press conference today in Washington following the conclusion of a two-day meeting of the Federal Open Market Committee. Theres not a specific number we have in mind. What weve seen in the last six months isnt it.
Stocks jumped, sending benchmark indexes to the highest levels since 2007, as the Fed said it will continue buying assets, undertake additional purchases and employ other policy tools as appropriate if the outlook for the labor market does not improve substantially.
Bernanke is enlarging his supply of unconventional tools to attack unemployment stuck above 8 percent since February 2009, a situation he called a grave concern. The decision immediately provoked a renewed backlash from Republicans, including Senator Bob Corker of Tennessee, who said Bernankes policies damage the Feds credibility while doing little to spur the economy.
The FOMC also said it would probably hold the federal funds rate near zero at least through mid-2015. Since January, the Fed had said the rate was likely to stay low at least through late 2014. The Fed said a highly accomodative stance of monetary policy will remain appropriate for a considerable time after the economic recovery strengthens.
(Excerpt) Read more at sfgate.com ...
Only if they’re expecting different results.
Money-Center banks and direct dealers will do great
Prepare to have your wages and savings further cut by inflation and zero interest-rates
Beyond the gobbledegook, doesn’t this simply mean the Fed is going to print money as fast as possible?
Hyperinflation, here we come.
Roosevelt’s “Pump-Priming” run amok.
Sorry, I do not see how buying mortgage bonds will improve the employment rate in any way
It won’t. This is nothing but giving Banksters guarantee that you the taxpayer will buy all the debt they create. Isn’t that wonderful.
If FedGov is just printing money why do I have to pay Federal Taxes? Just print what you want and leave me alone!
I don’t get how these guys can keep making these decisions without the approval of US citizens???
(sorry for the dumb question)
But how does that stimulate the private sector, or is it just the government spending that's supposed to spark increased private sector commerce?
I don't get it.
Hyperinflation, here we come.
Yes, but it does not automatically mean hyperinflation. That's the theory, that we'll have hyperinflation - but we've gone through 2 rounds of QE printing so far and no hyperinflation yet.
This is basically permanent QE and my guess is it was designed to goose the markets even more and guarantee Obama's re-election. Unfortunately the sugar high will likely boost the markets to record highs and it will help Hussein. Soon after the election though people will figure out that Bernanke has nothing left and the markets will crash back to earth.
Any chance it's also about convincing them to keep writing mortgages after they're done forcing the credit rating agencies to apply race-based "adjustments" to credit ratings?
The whole purpose of this move is to bail out the institutional investors who thought they were buying AAA-rated mortgage-backed securities but learned the hard way that they were wrong.
I need to take a dump - anyone got a $20?
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