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Fed makes new rate pledge,pumps more money into economy (More Stimulus or Bust!!)
Yahoo! Finance ^
| 12/12/12
| Reuters
Posted on 12/12/2012 11:02:28 AM PST by NormsRevenge
WASHINGTON (Reuters) - The Federal Reserve ramped up its stimulus to the economy on Wednesday, expressing disappointment with the pace of recovery in employment as contentious U.S. budget talks heighten uncertainty about the outlook.
The central bank replaced a more modest stimulus program due to expire at year-end with a fresh round of Treasury purchases that will increase its balance sheet. It committed to monthly purchases of $45 billion in Treasuries on top of the $40 billion per month in mortgage-backed bonds it started buying in September.
In a surprise move, the Fed also adopted numerical thresholds for policy, a step that had not been expected until early next year. In particular, the Fed said it will likely keep official rates near zero for as long as unemployment remains above 6.5 percent, inflation between one and two years ahead is projected to be no more than 2.5 percent, and long-term inflation expectations remain contained.
The Fed noted unemployment remains elevated ..
"The Committee remains concerned that, without sufficient policy accommodation, economic growth might not be strong enough to generate sustained improvement in labor market conditions," the Fed said in a statement.
Policymakers also repeated a pledge to keep buying bonds until the labor market outlook improves substantially. A drop in the jobless rate to 7.7 percent in November from 7.9 percent in October was driven by workers exiting the labor force, and therefore did not come close to satisfying that condition.
Under the "Operation Twist" program that will expire at the end of the month, the Fed was buying $45 billion in longer-term Treasuries with proceeds from the sale of short-term debt. The new round of government bond-buying it announced on Wednesday will be funded by essentially creating new money, further expanding the Fed's $2.8 trillion balance sheet.
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(Excerpt) Read more at finance.yahoo.com ...
TOPICS: Business/Economy; Extended News; Government; Politics/Elections
KEYWORDS: bernanke; economy; federalreserve; pledge; pumps; stimulus
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To: NormsRevenge
The fed will not buy bonds that are not issued because there is a new debt ceiling that restricts borrowing to current ceiling levels.
21
posted on
12/12/2012 1:37:32 PM PST
by
bert
((K.E. N.P. N.C. +12 .....The fairest Deduction to be reduced is the Standard Deduction)
To: JustTheTruth
The Fed will keep buying bonds to monitize Federal debt forever, and will buy mortgage debt until all of the banks who own true crap mortgagesBut the Fed doesn't buy crap mortgages from banks.
22
posted on
12/12/2012 3:31:21 PM PST
by
Toddsterpatriot
(Math is hard. Harder if you're stupid.)
To: NormsRevenge
Just keep buying gold folks.
23
posted on
12/12/2012 7:43:14 PM PST
by
Georgia Girl 2
(The only purpose of a pistol is to fight your way back to the rifle you should never have dropped.)
To: Gadsden1st
How does silver like it today?
24
posted on
12/13/2012 7:50:19 AM PST
by
E. Pluribus Unum
("The more numerous the laws, the more corrupt the state." - Cornelius Tacitus, Roman Senator)
To: Toddsterpatriot
But the Fed doesn't buy crap mortgages from banks
LOL....that's funny. Bernanke is buying them and the banks are selling them. It doesn't matter who is in the middle of the transaction. All the fraudulent mortgage paper is going to end up on the Fed's balance sheet - it's where that $hit will all be buried forever.
Have you figured it out yet Toddster? The ponzi scheme should be obvious even to you at this point. Bernanke is going to paper over everything, and pay 100% of the cost of the federal government too while he's at it.
QE will not stop until the dollar is totally destroyed, they can't stop now. The event horizon has been passed. HAHAHAHA. Even you must have bought some gold by now. Too bad you didn't start when I told you to years ago. Gold has been and will continue to kick the $hit out of stocks...and every other asset class.
25
posted on
01/04/2013 10:30:01 PM PST
by
dollarbull
(why are paperbugs so bad at history?)
To: dollarbull
But the Fed doesn't buy crap mortgages from banks
LOL....that's funny. Bernanke is buying them and the banks are selling them.
Yes, all those guaranteed mortgage bonds on the Fed's balance sheet. Just awful!
26
posted on
01/05/2013 8:09:44 AM PST
by
Toddsterpatriot
(Math is hard. Harder if you're stupid.)
To: dollarbull
Gold has been and will continue to kick the $hit out of stocks...and every other asset class.
27
posted on
04/15/2013 3:58:43 PM PDT
by
Toddsterpatriot
(Math is hard. Harder if you're stupid.)
To: dollarbull
Gold has been and will continue to kick the $hit out of stocks...and every other asset class.
28
posted on
05/23/2014 7:34:18 PM PDT
by
Toddsterpatriot
(Science is hard. Harder if you're stupid.)
To: Toddsterpatriot
Who is guaranteeing those bonds?
29
posted on
05/23/2014 7:40:10 PM PDT
by
Lurker
(Violence is rarely the answer. But when it is it is the only answer.)
To: Lurker
That would be the US Treasury.
30
posted on
05/23/2014 7:41:33 PM PDT
by
Toddsterpatriot
(Science is hard. Harder if you're stupid.)
To: Toddsterpatriot
“That would be the US Treasury.”
From where does the US Treasury get its money?
31
posted on
05/23/2014 7:42:36 PM PDT
by
Lurker
(Violence is rarely the answer. But when it is it is the only answer.)
To: Lurker
For the most part, taxing and borrowing.
32
posted on
05/23/2014 7:43:36 PM PDT
by
Toddsterpatriot
(Science is hard. Harder if you're stupid.)
To: Toddsterpatriot
So in essence the US taxpayer is guaranteeing those bonds.
“The Treasury” isn’t guaranteeing squat.
33
posted on
05/23/2014 7:47:20 PM PDT
by
Lurker
(Violence is rarely the answer. But when it is it is the only answer.)
To: Lurker
So in essence the US taxpayer is guaranteeing those bonds. Yup.
34
posted on
05/23/2014 7:49:09 PM PDT
by
Toddsterpatriot
(Science is hard. Harder if you're stupid.)
To: Toddsterpatriot
And you don’t see a problem with this little plan?
35
posted on
05/23/2014 7:50:00 PM PDT
by
Lurker
(Violence is rarely the answer. But when it is it is the only answer.)
To: Lurker
I don’t have a problem with the Fed only buying guaranteed bonds. The opposite of the garbage bonds some claimed they bought.
36
posted on
05/23/2014 7:53:36 PM PDT
by
Toddsterpatriot
(Science is hard. Harder if you're stupid.)
To: Toddsterpatriot
37
posted on
05/23/2014 8:15:20 PM PDT
by
Lurker
(Violence is rarely the answer. But when it is it is the only answer.)
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