[grania]

Assume that the fed doesn't stop quantitative easing or let interest rates increase, say to 2%. The insanity we have now can't go on forever. I'd think if the fed keeps up with this madness, they could totally lose control of the economy, and we'd end up with Greece or Argentina after the depression sized problems that have no solution.

Correct me where I'm wrong, please.

[Java4Jay]

Fed Sets October End for Bond Buying

http://www.freerepublic.com/focus/f-news/3178334/posts

[Salgak]

END UP with Depression-sized problems ??

Friend, we’re there already. . . .

[Reagan Disciple]

I think you are correct in your concern, but it would take a monumental collapse for the US to become Greece or Argentina.

Let’s say the Fed finally stops QE in October as planned.....and the US Treasury curve responds in-kind and the 10yr rate goes to 3+%....the Fed is not even close to being ready on raising the short end of the curve because this employment picture, where only 2-3yrs ago 6.1% UE rate was considered full employment by the Fed, the reality isn’t even close....then what?

Yellen does what Yellen is, she talks down the curve with more talk of free money. Maybe that never comes, hopefully it wouldn’t, but then you would have a 2000-2002 low rate environment like Greenspan promoted. Bad GDP growth, a mature housing market, a weak labor market......and then 2007 came and the cracks started to grow. This time it would take less time for those cracks to show.

The ECB is about 3yrs behind the US in this ‘free money’ cycle so they may stem the pain for some time. With a rationale Fed and lawful White House this may have granted enough time to help the US economy stand on its own again. But not this Fed and certainly not this WH.

Time may be coming to by VIX calls. They Fed is begging us to......they are going to increase volatility and inflation....whether the markets want it or not.