I had read something about QE having lost its ability to artificially undergird/stimulate the economy. My guess is they’ll try higher than 85B before they give up on it. They’ll go to 100B maybe. That’ll send the market soaring.
It’s conceivable that the exit strategy is to let the republicans win the 2016 election and blame the market crash and hyper-inflation on them. Hillary shouldn’t be so confidant of victory.
Quote from Dallas Fed Chairman Richard Fisher:
It is my firm belief that the fault in our economy lies not in monetary policy but in a feckless federal government that simply cannot get its fiscal and regulatory policy geared so as to encourage business to take the copious amount of money we at the Fed have created and put it to work creating jobs and growing our economy. Fiscal policy is not only “not an ally of U.S. growth,” it is its enemy. If the fiscal and regulatory authorities that you elect and put into office to craft taxes, spending and regulations do not focus their efforts on providing incentives for businesses to expand job-creating capital investment rather than bicker with each other for partisan purposes, our economy will continue to fall short and the middle-income worker will continue being victimized, no matter how much money the Fed prints.I don’t want to ruin your evening after such a pleasant dinner. But if you wish to know who is at fault for hollowing out the welfare of middle-income workers and the American economy, kindly do not look at me or my colleagues at the Fed. When you go home tonight look at yourself in the mirror. We at the Fed are providing more than enough monetary accommodation. You elect our fiscal and regulatory policymakers. It is time for them to do their job, to ally themselves with us to achieve a fully employed, prosperous America. Only you, as voters, have the power to insist that they craft policies that are needed to restore American prosperity. Please do so.
Have a most pleasant evening!
While nobody knows the future, we do know that in 2013 the fed began cutting back on buying T-bills now that prices have stabilized. Since then the Dow's been hitting all time highs. It's for sure that America's been having some pretty bad economic problems, but historically anyone who's underestimated the strength and power of the American people to make things right have done so at their own peril.