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I'd note that the statement said "November meeting The Committee will continue to monitor the economic outlook and financial developments and will employ its policy tools as necessary to support the economic recovery and to help ensure that inflation, over time, is at levels consistent with...

Depends on what is your definition of 3

I'm puzzled by why the market thinks its 'an ok statement' at least so far. The size was right around expectation(surveys were saying $500b or more) but there is no firm commitment from the Fed, they want to have the cake and eat it too by putting the 'we can back down' clause there. I believe...

" In addition, the Committee intends to purchase a further $600 billion of longer-term Treasury securities by the end of the second quarter of 2011, a pace of about $75 billion per month. The Committee will regularly review the pace of its securities purchases and the overall size of the...

Another way of putting it is "Fed doesn't care about employment or the GDP output gap as much as their care about preventing deflation and being conservative with balance sheet risks at the same time" I believe this QE2 effort confirms that given that employment didnt change radically over...

I believe Hatzius estimate that the Fed might endup buying up to $4T in assets is wrong. I understand he is not talking about this meeting but over the course of the many possible QE incarnations but I still disagree with that number. He arrived at the number by doing estimates of how much asset...

5y inflation expectations are getting a bit out of control http://noir.bloomberg.com/apps/quote?ticker=USGG5Y5Y:IND My bet is that the Fed dissapoints tomorrow

IB offered to ask some questions in order to "Interactive Brokers has requested this information so that it can determine whether you qualify under applicable securities laws for a wider range of investment choices and financial options than would be available to a standard investor. If you...

I happen to believe monetary policy is one of the critical government functions(Along with the army, legal system, police, etc). And I dont think a reasonable libertarian can disagree. Sure one might say 'leave it to the market' but what if we find out later(with reasonable certainty) that its a...

A society will always have a monetary policy and the government will always either control it or oversee it(because those policies can have huge impacts). So a choice needs to be made, if you are not in favor of a Fed then you must be in favor of some kind of gold standard. I fail to see how the...

I'd make a few points -The fact that I believe that QE can 'work' is grounded on the belief that I have that the evidence supports Fisher's theory of debt deflation, that a collapsing money supply would lead to negative feedback loops(or Reflexivity) that would lead to unnecessary declines in...

I disagree. The Fed doesn't have to destroy the dollar to accomplish their goals. The extreme examples I give sometimes(mailing trillions of dollars in checks or monster QE programs) is simply to point out the absurdity of the 'Fed is impotent, we are Japan' camp. Krugman is back again at...

Now the dude is trying to discredit M2 "M2 as a measure doesn't even distinguish between assets and liabilities. Don't you think this is important? Don't you think this might just have some bearing on what's been going on in Japan since 1985, or why Fed policies to date have been ineffectual...

I'm assuming that most people given a choice between a 30's style decline in real GDP and saving bankers by breaking the law would choose the latter. Now maybe you disagree with the assumptions in the comparison(That the world faces a 1930's collapse if the financial system goes) but that is the...

Whether QE will create real wealth compared to doing nothing is a different debate. I happen to believe the answer is yes but thats not even what I'm arguing. I'm going after that people who claim the Japanese scenario(flat NGDP, deflation or zeroish inflation) is inevitable and there is nothing...

Now the dude claims all the QE hint did was induce traders to swap USTs completely ignoring my point about higher inflation expectations(hence higher cost of holding cash) which increases velocity. If he agrees with this point, then he will have agreed that the Fed can raise M, V and yet they...

Actually a lot of people doubt that Fed can create inflation and avoid the Japanese disease. I dont think I'm taking a cheap shot, heck I'M in the deflation camp for the short-run(next year or 2). Its the folks who doubt a committed central bank can create inflation that I'm going after

Okay now the dude said he accepts that velocity might be rising after the Fed QE hint but "I can see a lot of trading and positioning over QE2, and yes this may count as velocity, but I don't see AD rising." Funny, the dude accepts that the Fed can raise both M and V but somehow doesnt...

Gross is calling for the end of the UST bull run. I believe this is not the first time he did that(I recall a few years back the saying he was 'now a bear market bond manager') But I believe he's got a point, if QE2 is large enough actually work the 30y is a short because rates would go up...

I have been debating some perma deflationists in the last few days. Its funny, the argument they use keeps changing. When they say QE is infective because the money is just ends up on banks balance sheets as excess reserves. I point out that 40% of QE1 endup in the non-bank sector and M2 rose...