[OB1kNOb]

The Fed gave itself flexibility by adding that it would "adjust" its holdings of Treasurys and mortgage-backed securities as needed.

Here's the money statement. Just as I surmised last week. The Fed declares "victory" over the "improving" economy, says no more QE is needed after #2, and then as soon as the economy and the markets take another downturn from no longer being pumped up, the Fed will call it something else, but it will in fact be more QE whether it's QE2.1 or QE3.0.

[demsux]

Noticed that too...didn’t say “decrease” holdings.

[fluffdaddy]

“The Fed declares “victory” over the “improving” economy, says no more QE is needed after #2, and then as soon as the economy and the markets take another downturn from no longer being pumped up, the Fed will call it something else, but it will in fact be more QE whether it’s QE2.1 or QE3.0.”

Exactly.

I very much doubt the Fed could stop monetizing the debt without bringing the government to a crashing halt. Are there enough investors to buy all the debt we need to issue if the Fed gets out of the market? When QE2 ends the Fed will have to replace it with some other mechanism for accomplishing the same end. If it doesn’t we won’t be able to beg, borrow, steal or print enough money to keep the federal government functioning. Nobody in the governing class wants to see the federal government bouncing checks; the Fed will keep the monetary shell game going long after our currency is destroyed.

[PA Engineer]

the Fed will call it something else, but it will in fact be more QE whether it's QE2.1 or QE3.0.

Bernanke has really instilled confidence in the dollar. [/sarcasm]

With two trillion in Chinese short term debt to be absorbed, I was thinking they will rename it "Vista 1.0". The dictionary definition is "2. A mental view of a succession of remembered or anticipated events: "vistas of freedom"".

Bullion has shot up again.

The manipulation is not working and the dollar is dead. The Chinese have stated they will buy a trillion dollars (primarily metals) of commodities and the remainder in a basket of currencies.

The two trillion will be in addition to this years deficit. Hyperinflation is a guarantee.