Posted on 07/12/2011 7:55:56 PM PDT by DeaconBenjamin
The minutes of June's gathering of the Federal Open Market Committee (FOMC) – the body that sets interest rates in the US – show that some officials believe fresh stimulus may need to be considered while others estimate that the risk of stoking inflation is now too high for such actions.
The FOMC last month ended its controversial policy of quantitative easing, which saw the central bank buy $600bn (£377bn) of government bonds from banks and insurance companies in an effort to keep long-term interest rates low.
Ben Bernanke, the chairman of the Fed, indicated in April that a further bout of QE would risk triggering inflation.
In the minutes of the meeting of June 21-22, released yesterday in Washington DC, the central bank said that "the committee might have to consider providing additional monetary stimulus, especially if economic growth remained too slow to meaningfully reduce the unemployment rate in the medium run".
Hopes that economic growth would accelerate in 2011 have so far been disappointed as the rising petrol and food prices that marked the first five months of the year hit US consumers. That optimism was dampened further last week by the employment report for June that showed the US economy created just 18,000 jobs last month, against expectations of 100,000-plus. Few on Wall Street now think the world's biggest economy expanded at much more than a 2pc pace last quarter.
However, any move by some members of the FOMC to unleash further stimulus is likely to run into opposition from colleagues. The minutes noted that "a few members viewed the increase in inflation risks as suggesting that economic conditions might well evolve in a way that could warrant the FOMC taking steps to removing policy accommodation sooner than currently anticipated."
(Excerpt) Read more at telegraph.co.uk ...
In the mean time, coincidentally, gold approaches its all time high.
In other words the Fed splits.
LOL - yeah, 'coincidentally'...
The FED will keep interest rates low AT ALL COST to prevent the deficit from really ballooning (due to rising interest payments). The rub is that the extra $$ from CD interest would really jumpstart the economy.
Inflation, the cruelest tax of all.
How will the economy “pick up” when we’re sending all our jobs and money to China?
Wake up. There’s a trade war happening, and we’re not fighting back.
Ah. The veil of secrecy is fraying and will be rent asunder if the US doesn’to continue to indenture itself and submit to economic and foundational rape. The Fed will be revealed to be....
Split the federal reserve into 8 organizations, give them all printing presses and let them compete.
I’ll use the notes from whichever wants a strong currency.
Nominal, but also in pounds, euros, and yen.
The piece is propaganda. The Fed has already planned another $300 billion in bond purchases.
I think Rupert Murdoch would be a far better Fed person than any of the others we’ve had.
At least the guy believes in making money by providing something people want.
Maybe US trade representative.
Turn a profit, for America for once.
Whatever Ben wants.
Ben Gets.
Well, it’s nice (for a change) to see that the Republican Party isn’t the only body that’s divided.
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