Fed to Taper in October?
Tapering having been rejected this month, a Fed member now says they may taper in October. The game continues - and it is a kind of game.
Or maybe they don't want to send the message of "QE to Infinity" and will just play this monthly hide and seek for the foreseeable future.
Or maybe it's some combination of both, or there are other factors they're considering.
With all this talk and tinkering with tapering (alliteration!), don't you get the feeling we're being played? Or maybe that they have not idea what they're doing, or no idea what to do?
In any case, do you really believe they're applying some sort of sound logic or any kind of scientific approach to this? The idea of just a little tapering sounds kind of natural, maybe even logical or scientific, doesn't it?
Well, unless I'm way off base, it just strikes me as a game. They know that someday they'll have to do something with all those bonds they've bought - $3.7 trillion to date. So they keep throwing out "tapering" to see what happens in the markets, because they don't want to actually taper and see markets plummet. And maybe Bernanke's figuring he'll keep the ship afloat until the next captain takes the helm (Yellen?). Then they can deal with the mess.
So just when you thought we were done with taper-talk for a while, it's back again. Thanks Bullard.
NEW YORK (MarketWatch) -- The Federal Reserve could begin to slow asset purchases at its October meeting depending on economic data, said St. Louis Fed President James Bullard Friday on Bloomberg Television. "October is a live meeting," he said. "This was a close decision here in September, so it's possible you get some data that change the complexion of outlook and make the committee be comfortable with a small taper in October."With markets rallying strongly two days ago, the Fed-folks may have figured, OK, the rally wasn't that big a deal and didn't really continue after that. Maybe we can taper next month.
Or maybe they don't want to send the message of "QE to Infinity" and will just play this monthly hide and seek for the foreseeable future.
Or maybe it's some combination of both, or there are other factors they're considering.
With all this talk and tinkering with tapering (alliteration!), don't you get the feeling we're being played? Or maybe that they have not idea what they're doing, or no idea what to do?
In any case, do you really believe they're applying some sort of sound logic or any kind of scientific approach to this? The idea of just a little tapering sounds kind of natural, maybe even logical or scientific, doesn't it?
Well, unless I'm way off base, it just strikes me as a game. They know that someday they'll have to do something with all those bonds they've bought - $3.7 trillion to date. So they keep throwing out "tapering" to see what happens in the markets, because they don't want to actually taper and see markets plummet. And maybe Bernanke's figuring he'll keep the ship afloat until the next captain takes the helm (Yellen?). Then they can deal with the mess.
So just when you thought we were done with taper-talk for a while, it's back again. Thanks Bullard.
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