Fed Launches QE3
Submitted by P.Au.L on Wed, 09/12/2012 - 08:02WASHINGTON (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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they will not let rates rise....they cannot!
TPTB are way more terrified of deflation...yes, we may see a few deflation drops along the way in the market or signs of it in leading/trailing economic indicators...but alas, print they will.
no, they will not raise rates, because they are also afraid of something called "the bang point" It is defined as the point when monetary or fiscal policy can no longer contain the market.
the 10yr Tnote was at 1.68 yesterday... this is what mortgage rates are based off of...how much lower do they want to go? zero?
Raising interest rates also threatens big government.
$16 Trillion in debt financed with short term notes that will have to be refinanced soon. If the rates rise, U.S. will not be able to pay the interest on the national Debt. That means US bankruptcy.
But there is a little more wealth to squeeze out of the economy:
http://pricedingold.com/charts/DJIA-1900.pdf
Then the SHTF
Free includes debt-free!
WHO are they kidding!!
The FED has been pumping QEad nauseum into this market. Just look at the stock market exponential rise since the end of JUNE!
Give me a break. They can "say" what they want, but they've been lining the pockets of their "buddies" for a long time and front-running the money into Wall Street for a "legal" (hah) "take" on the money---to the tune of trillions of dollars stolen from the taxpayers.
I felt the "pinch" with airline tickets just yesterday with almost DOUBLE the air fares. It is so unfair, all of it.
I understand that.
What I also understand is over the past 5 years, as those of us who took advantage of the wretched economy and stored some % of our wealth in metal seen huge gains (bigger gains than the s&p) we can also see a lot of our gains disappear. An oz of gold bought $35 USD's in 1970. The last time an individual was able to buy an oz of gold for $20(.67) was in 1933. When interest rates rise, and sooner or later they will, I know what I will be doing. It is unreal that for 60 cents you can buy a hair-cut, in constitutional silver that is.
"screw gold holders" was a bad way to describe it. I imagine if one was smart enough to invest in gold, they are smart enough to know when to get out.
“When a well-packaged web of lies has been sold gradually to the masses over generations, the truth will seem utterly preposterous and its speaker a raving lunatic.” – Dresden James
You are correct. $35 is correct for 1970
"they are smart enough to know when to get out" and when to get in.
Buy low and sell high.
Free includes debt-free!