Free Republic

Time for the Fed to Twist and Shout Again By NICHOLAS HASTINGS The U.S. Federal Reserve is likely to hang on to its real monetary ammunition for now. Uncertainty over global growth, the continued debt threat to the euro and the so-called "fiscal cliff" that faces the U.S. all mean that the central bank will likely reserve a third dose of quantitative easing in case it is needed later on. Instead, the Fed is likely to use its meeting this week to counter the recent slowdown in the U.S. economy with an extension of Operation Twist--a system of selling short-term...

SocGen: We Expect A $600B QE3 Plan To Be Announced This Week Matthew BoeslerJune 18, 2012 A third round of quantitative easing is coming this Wednesday, top Société Générale economist Michala Marcussen says. Marcussen writes that if anything, the boost will help "only at the margins." "We have long held the view that each new round of QE comes with diminishing returns," she says. "We nonetheless see the impact as positive – if nothing else giving the reassurance of a pilot in the plane." On how the Federal Reserve will announce and implement QE3: With economic data signalling stall speed...

It is no secret that The Fed is mulling over further monetary stimulus. Whether it is quantitative easing (QE3) or curve twisting (Twist3) remains to be seen. Senators Jim Demint (R-SC) and Mike Lee (R-Utah) have proposed legislation, S.3240, that caps the balances of reserves of depository institutions. AYO12664 In order to prevent the Federal Reserve from further quantitative easing, Sen. DeMint’s No QE3 amendment would prevent the Fed from expanding its balance sheet again, as well as establishing that the Fed should return the size of its balance sheet to pre-2008 levels. Wow, THAT is a provocative piece of...

The Federal Reserve Board faces a myriad of interesting questions, but the one of most of the world’s mind is … to QE or not to QE. That IS the question. Chairman Bernanke’s statement to Congress this past week did not say much except that The Fed is standing by in case things get worse. But I will take a wager that QE3 is coming at the next meeting of the Fed’s Open Market Committee (FOMC). But I am not willing to make a big wager, because there are some sound arguments NOT to do any additional quantitative easing. So,...

Jun 7, 2012 4:46pm Fed Chairman Ben Bernanke Warns Congress on ‘Taxmaggedon’: ‘If You All Go on Vacation, It’s Still Going to Happen’ The Federal Reserve Board Chairman had a stern warning today for Congress: “Taxmaggedon” is real, it’s coming and only lawmakers can save the nation from falling off this rapidly approaching “fiscal cliff.” “What is particularly striking here is that this is all pre-programmed,” Fed Chairman Ben Bernanke said. “If you all go on vacation, it’s still going to happen, so it’s important to be thinking about that and working with your colleagues to see how you might...

WRAPUP 3-Yellen argues for more Fed easing amid Europe risk Thu Jun 7, 2012 7:56am IST By Ros Krasny (Reuters) - The Federal Reserve's second-highest official on Wednesday laid out the case for the U.S. central bank to provide more support to a fragile economy as financial turmoil in Europe mounts. Janet Yellen, the vice chair of the Fed, cited risks from ongoing housing problems, a weak jobs market and worsening financial conditions in a speech in Boston. Her views carry great weight with Fed Chairman Ben Bernanke, and her comments suggest that the Fed may be close to easing...

STOCKS STAGE GINORMOUS RALLY: Here's What You Need To Know Simone Foxman June 6, 2012Markets across the world staged a major rally today, and central banks are at the center of the chatter. But first, your scoreboard: Dow: 12,398; +271 pts S&P 500: 1,312; +27 pts NASDAQ: 2,841; +63 pts Now for the day's top stories: * Markets began rallying in the pre-market after WSJ's star Federal Reserve reporter John Hilsenrath wrote last night that euro woes, disappointing economic data, and strains in financial markets "have prompted a shift at the Federal Reserve, putting back on the table the possibility...

Are Stocks About to Repeat Their Summer Horror Show? Published: Sunday, 3 Jun 2012 | 7:19 PM ET By: Patti Domm CNBC Executive News Editor Like the third sequel to a summer horror movie, stocks are set up for another summer selloff amid fears that the U.S. economy will slide back into recession. “In the last two summers, the final nail in the equities coffin, the thing that pushed it was a double dip scare. We do think the market is going to increase expectations of that in the coming week,” said Barry Knapp, head of U.S. equity portfolio strategy...

Wall St boosts QE3 expectations after May jobs data By Chris Reese NEW YORK | Sat Jun 2, 2012 7:49am IST (Reuters) - Wall Street economists see an increased chance the Federal Reserve will launch another round of monetary stimulus to support the U.S. economy, following data showing jobs growth slowed markedly for a third straight month in May. The median of forecasts from 15 primary dealers - the large financial institutions that do business directly with the Fed - gave a 50-percent chance the central bank would eventually launch another round of quantitative easing, known as QE3. A similar...

QE3 Likelihood Still ‘Pretty Good’: Jan Hatzius Published: Tuesday, 22 May 2012 | 6:55 PM ET By: Lee Brodie With the latest existing homes sales data looking relatively strong and other economic data suggesting the US recovery is stable, many investors believe further Fed intervention is off the table. But Goldman Sachs chief economist Jan Hatzius says not so. Although he admits, “The Fed hasn’t made up its mind,” Hatzius believes if you list out the pros and cons - the scales are starting to tip in favor of further monetary easing and the Fed knows it. “Given the financial...

April 19 (Bloomberg) — Sales of previously owned U.S. homes in March unexpectedly fell for the third time in the last four months, showing an uneven recovery in the housing market. Purchases dropped 2.6 percent to a 4.48 million annual rate from 4.6 million in February, the National Association of Realtors reported today in Washington. The median forecast of economists in a Bloomberg News survey called for an increase to 4.61 million. In January, sales at a 4.63 million rate were the strongest since May 2010. And The West is not the best. Down 7.38%. But at least median house...

SocGen: QE3 Is Coming Soon, But First The S&P Is Going To Tank Joe WeisenthalFebuary 13, 2013 SocGen has put out a big special report titled: QE3 delayed, but still likely. Their high level overview of where things stand right now looks like this: * QE3 has been delayed by the recent bout of good news from the US economy: SG is now in line with the consensus, expecting the launch in Q2 (24-25 April FOMC meeting). * As the $400bn Operation Twist program is still boosting demand for long-dated US Treasuries, we believe the Fed will be concentrating its...

The Federal Reserve has moved closer to embarking on a new round of its controversial money-pumping after the central bank and its chairman Ben Bernanke highlighted a grim outlook for the U.S. economy. Bernanke on Wednesday opened the door a bit wider for the Fed to return to buying securities in the months ahead to buttress a weak recovery and keep inflation from slipping too far below its newly adopted 2-percent target. "It sounds like the finger is on the trigger," said Thomas Simons, a money market economist at Jefferies & Co. The Fed's announcement that it was unlikely to...

So far, during the presidency of Barack Obama, the price of a gallon of gasoline has jumped 83 percent, according to data from the Bureau of Labor Statistics. (AP Photo) During the same period, the price of ground beef has gone up 24 percent and price of bacon has gone up 22 percent. When Obama entered the White House in January 2009, the city average price for one gallon of regular unleaded gasoline was $1.79, according to the BLS. (The figures are in nominal dollars: not adjusted for inflation.) Five months later in June, unleaded gasoline was $2.26 per gallon,...

Recovery: The media have busied themselves with touting the big economic rebound they see brewing in the U.S. We hope they're right. But if they are, why is the Federal Reserve getting ready to print even more money? The media argument goes like this: After years of struggling, the economy is finally churning out jobs. Last month alone there were 200,000 new ones, with unemployment falling to 8.5% - its lowest since Obama entered office. But say this for the Fed: It didn't sit on its hands. In those first two QE efforts, it bought $2 trillion of government-backed mortgage...

Federal Reserve officials are seriously considering giving the US economy—and especially the housing market—an added jolt with more quantitative easing. Fed officials are likely to discuss such a move at their Jan. 24-25 meeting, when the central bank will issue its first quarterly forecast on interest rates under the new communication policy. Two of the new voting members this year on the Federal Open Market Committee, which sets interest-rate policy, have recently suggested they would support more assets purchases. San Francisco Fed President John Williams said that sustained high levels of unemployment, as forecast by many Fed members, "does make...

IS QE3 ON THE WAY? 14 December 2011 by Cullen Roche Despite the weakening global economy the Fed showed no signs at the most recent FOMC meeting of planning QE3. Markets didn’t take kindly to the news and promptly sold off. But that doesn’t mean QE3 isn’t in the cards. In fact, I think it’s likely to become a topic of debate in the first quarter of next year and becomes a high probability event by the end of Q2. In a story last week FT Alphaville highlighted the fact that the Fed is increasingly dovish and likely to move...

Ranting Andy Hoffman is back on the show to discuss the most recent attack by "Da Boyz" in an attempt to convince the populace that everything is fine and that nothing can go wrong. However, even while the price of precious metals appears to go down, there is no evidence of any physical gold and silver holders are paying any heed. They are holding on to their metals caches and even using the brief dip as an opportunity to load up on more. Perhaps they know something that the rest of the population doesn't. As Andy stated, there is a...

Jefferies strategist David Zervos is back again with new recommendations about how the U.S. could step in and save the global economy. This week: threaten complete disaster if EU leaders don't act right away. Akin to what he said about the matter last week: The game in Europe is as we have described many times before - the Germans want budgetary control throughout all of Europe and the rest of EMU wants Eurobonds. Its a game a chicken with the entire global financial system on the line. The US should not allow itself to become a casualty in this Euro...

Bottom Line: The Fed Is Trapped By Inflation Lance Roberts, Street Talk Live Nov. 2, 2011, 6:38 AM There will be NO announcement of QE 3 today. Why? Because the Fed has trapped itself into a corner. The first two rounds of Quantitative Easing (QE1 and 2) were viable for the Fed as inflation was running at deflationary levels in 2009 and at the bottom of their target range of 1-3% in 2010. In both instances the implementation of asset purchase programs, which immediately juiced liquidity in the financial markets, had an immediate and pronounced effect on the level of...