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Fed Launches QE3

WASHINGTON (MarketWatch) — The Federal Reserve, worried that improvement in the unemployment rate has stalled, announced a third, large purchase of bonds on Thursday in an effort to bring down long-term interest rates and spur growth.

The Fed said it would buy mortgage-backed securities at a pace of $40 billion per month.

The Federal Open Market Committee, which ended a two-day meeting on Thursday, said it was concerned that, without the action, “economic growth might not be strong enough to generate sustained improvement in labor market conditions.”Read text of statement.

http://stream.marketwatch.com/story/fomc-update-bernanke-on-...

Federal Reserve decision due 12:30 p.m. Thursday, followed by press conference

WASHINGTON (MarketWatch) — Fed watchers have little doubt the central bank is getting ready to launch what’s commonly called “QE3,” or a new large-scale asset purchase plan, but many think the countdown will be placed on hold until later this year.

“We don’t think the most likely outcome [in September] is going to be the announcement of another large scale asset-purchase plan. I am not convinced they are ready for it,” said Lewis Alexander, chief U.S. economist at Nomura Holdings.

“FOMC members continue to struggle with the appropriate structure for a future QE,” agreed Ward McCarthy, chief financial economist at Jefferies.

If this is the case, analysts said, headlines from the two-day meeting that ends Thursday will come from a less-aggressive step of altering language on a low-rate pledge. This will likely be extended until mid-2015. The current Fed pledge is to keep rates at “exceptionally low levels” through at least late 2014.

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What are you kidding

The price of silver is still a STEAL compared to where its really at! The Fed said it would buy mortgage-backed securities at a pace of $40 billion per month. Thats a guarantee that your silver will go higher every Month. WHAT AN AWESOME ADVANTAGE! BUY BUY BUY. Make it a challenge how much Junk silver can you get at the end of this month.

His name is Edward Snowden

What is Capitalism?
http://youtu.be/yNF09pUPypw

Who are they buying the MBSs

Who are they buying the MBSs from? Any banks in particular?

If ignorance is bliss, Washington DC must be heaven.

fireant's picture

Primary dealers and other preferential institutions

would be my guess. It smells like collateral issues are developing, and the fed is helping out. Interesting development along those lines:
http://www.bloomberg.com/news/2012-09-11/bny-mellon-says-der...

Undo what Wilson did

Weimar

Here's a nice family photo from the Weimar Republic!

http://ibankcoin.com/jakegint/wp-content/imagescaler/9d3d5fa...

Does this also mean that

mortgage rates will drop again? Pretty soon I will be refinancing at a negative interest rate and get some of my worthless money back from a government backed loan :)

Finally pissed off enough to spread the word of Dr. Paul
Here's song I wrote for a close friend and wounded Iraq war veteran:
http://www.reverbnation.com/play_now/song_8738783

Premiums on gold and silver will rise

I just checked www.goldshark.com and the premiums are remaining the same for gold and silver coins. But I'm willing to bet they are going to rise. If you're looking to buy gold and silver something to think about.

$40 billion per Month... INDEFINITELY.

http://www.marketwatch.com/story/fed-to-launch-qe3-by-buying...

Looks like this time, it will be $40 billion per month, ... indefinitely. In other words, half a trillion dollars of printed money every year.
The Fed and Obama Administration are right on queue. As we suspected, a few months before the election, "stimulate" the economy, stock prices get bid up, stock market has the illusion of looking like it's recovering, therefore everyone thinks the economy is recovering. Everyone says, "Obama was right after all. So was Krugman and Bernanke. All we had to do was be patient." And all right before the election. What a coincidence.

The next big action would be if the Fed stops paying the banks interest on their reserves. That would trigger them to lend the trillions in their vaults from QE2. That gets all this new money into the system, and let the inflation ride begin. I wonder where the next bubble will inflate?

I'm going to get my wheelbarrow out tonight and clean it out. I'd hate for all my Federal Reserve Notes to get dirty on the way to the grocery store to buy a loaf of bread.

fireant's picture

Where are the borrowers?

If those trillions are to be loaned out, someone has to borrow. Who is borrowing now other than government juiced markets of autos and education?
All those trillions seem to stay in the banking system, which is wrought with peril, making me think this is just another bank bailout.

Undo what Wilson did

The banks claim they are not

The banks claim they are not loaning out the money because there is low demand, while many people say that the banks are holding the money because they have a lot of toxic assets that they need to prepare to pay off.

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

Just when RP is out

That is not a coincidence...

The FOMC meeting has been on

The FOMC meeting has been on the schedule for months if not years....

To infinity and beyond.....

.Ben Lightyear

The individual has always had to struggle to keep from being overwhelmed by the tribe. If you try it, you will be lonely often, and sometimes frightened. But no price is too high to pay for the privilege of owning yourself.
Friedrich Nietzsche

Bernake just reelected 0bama.

Bernake just reelected 0bama. Cya Romney. The Fed wins, Fatality.

The Honey Bernake don't give a **** about your silly vote in Nov. It does what it wants.

What? The FED doesn't care if

What? The FED doesn't care if Romney wins.

End The Fed!
BTC: 1A3JAJwLVG2pz8GLfdgWhcePMtc3ozgWtz

Romney said he would fire

Romney said he would fire Bernake and reign in the fed. Even though he wouldn't it's the perception that matters. Gotta keep the circus going for the sheeple =)

Enjoy the gift. Stocks and Gold/Silver going higher for at least 6 months.

Buy buy buy! Gold and silver

Buy buy buy!

Gold and silver that is

http://www.youtube.com/watch?

lol, look at

We all knew it was coming

I personally just thought he'd wait til after the election.

No. Come on now...

...this is all about the election. The crash will come, but the Fed will do everything in its power to make it happen after the next election...and the next election....eventually the house of cards will come down though.

We all want progress, but if you're on the wrong road, progress means doing an about-turn and walking back to the right road; in that case, the man who turns back soonest is the most progressive.

-C. S. Lewis

why don't they just call it

why don't they just call it for what it is? $480 Billion expansion/yr

They are welcome to buy mine

I'd love to default on it and screw them over!

=)

Our family's journey from the Rocket City to the Redoubt: www.suburbiatosimplicity.com

I really

can not believe he is doing this. Wow. Grab your ankles.

I thought they would wait...

till after the sham election but, the people know already so let's just do it.

"Necessity is the plea for every infringement of human freedom. It is argument of tyrants. It is the creed of slaves." William Pitt in the House of Commons November 18, 1783
"I know major allies who fund them" Gen. Dempsey

I saw Gold

Hit +21$ up already

Yup, I am watching it yo-yo

Yup, I am watching it yo-yo up too. It is fun :)

Michael Nystrom's picture

The Fed must be irresponsible to be responsible...

Huh?

http://articles.marketwatch.com/2012-09-12/commentary/337778...

You see, the Fed may to try to change the economy by talking, not by doing. This may be a case where words speak louder than actions.

The Fed is going to try to persuade investors and the public that it’s really going to keep interest rates low until the economy actually recovers all its lost ground, even if that means breaking its own informal rules about how to formulate policy in the face of rising inflationary pressures.

In effect, the Fed has to persuade us that it’s happy to let inflation temporarily exceed the Fed’s long-run target of 2%, that the Fed won’t rush to raise interest rates at the first sign of accelerating inflation. Holding back at that point would go against every fiber of a central banker’s being, but the Fed must credibly promise to hold back.

The Fed must commit to being irresponsible, just as American presidents during the Cold War had to commit to being willing to destroy the world in order to deter a nuclear attack.

To be mean is never excusable, but there is some merit in knowing that one is; the most irreparable of vices is to do evil out of stupidity. - C.B.