Bernanke Calms Markets with Hint of QE3

For the past year, in my mind it’s only been a matter of when, not if. It appears the groundwork for QE3 slowly begins today. Ben says there are no inflation issues, hence it’s good to go on more easing.

“The Committee will continue to closely monitor economic developments and is prepared to take further action as appropriate to promote a stronger economic recovery in the context of price stability,” Bernanke said.

Stressing that higher inflation earlier in the year had not become ingrained in the economy, Bernanke argued price pressures will remain subdued for the foreseeable future.

“Bernanke is not saying anything that we haven’t heard recently,” notes David Ader at CRT Capital, but the idea of being “prepared to take further action can only mean QE3,” which means bulking up the Fed’s balance sheet…

Pavlov dogs are responding accordingly with the NASDAQ now in the green. They never change their stripes. (let’s see how long of a lift this one gets, versus yesterday’s ISM Mfg data)

It is amazing how drug dependent we now are. If you look at the time frames the past 2+ years there has been no QE, the market has been in almost constant freefall. When QE is on, we celebrate like its 1999.

In an unrelated note – he did not apologize for being completely wrong with his ‘transitory’ comments this spring, as it related to the slowdown. He also did not say oops on how badly off the Fed economic forecasts have been (yet again). Because he is accountable to no one.

About Mark Hanna 542 Articles

Affiliation: Hanna Capital, LLC

Mark Hanna is President and Owner of Hanna Capital, LLC, a registered investment advisory firm. Mark has been a follower of markets since the late 80s, with a focus on individual equities since the mid 90s. He has been a well known commentator in the financial blogosphere for the past 5 years, following a career in corpoporate finance and accounting. Mark attended the University of Michigan where he graduated with a degree in Economics.

As an avid reader, Market Montage is the personal blogging site for Mark to share his views on economics, markets, and the like. Occasional cynicism and wit shall be deployed in his postings.

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1 Comment on Bernanke Calms Markets with Hint of QE3

  1. qe3 is basically a lock, first of the year money printing will ramp up on a massive scale. a trillion plus is guarenteed, 2 trillion possible.2012 will be year of massive printing and borrowing

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