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Bullard Says Fed Could Wait Until December To Make Decision

Tyler Durden's picture




 

The doubts over QE2 are increasing. Yesterday, Dallas Fed's Fisher raised the warning flag when he said that "despite recent speculation in the press and among market pundits, we did little at that meeting to settle the debate as to whether the Committee might actually engage in further monetary accommodation, or what has become known in the parlance of Wall Street as “QE2,” a second round of quantitative easing." Today, St. Louis hawk Bullard makes an even stronger case that the run up in stocks since the August lows is unjustified, or at least, largely premature, when he told CNBC that "Federal Reserve officials
could wait until December before making any decision to ease
monetary policy further if they feel they need more clarity on
the outlook." He added that "We did hit this soft patch in the economy but it's not so
soft that it's obvious that you have to do a lot right now. It's still possible to make the case that
the economy will improve naturally." Most importantly, Bullard clarified that the Fed missing its policy targets do not make a case for further easing a slam dunk, that the economy may still improve without extra help, and that has not heard of any discussion at the Fed moving in the direction of buying a broader range of securities. On the other hand, Bullard also said that it doesn't look like the Fed will be able to get inflation back close to target without more policy help, making the confusion complete. 

So there you have it - Greenspanism reincarnated, which as far as the futures are concerned is not a good thing, and if Goldman is right, and the bulk of he QE2 impact has already been priced in, the unwind on November 3 could well be too fast and too furious if indeed all this is not just posturing.

Then again, the uultimate decision maker is Ben. And he doesn't like the middle class.

 

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Fri, 10/08/2010 - 07:59 | 634658 EscapeKey
EscapeKey's picture

"It's priced in already". So are bad jobs reports, the destruction of the Dollar, the election of Britney Spears as the first female president, and the invention of the perpetual motion machine.

 

Fri, 10/08/2010 - 09:47 | 634902 deez nutz
deez nutz's picture

A+

Fri, 10/08/2010 - 12:35 | 635549 dlmaniac
dlmaniac's picture

Funny to see Fed catching themselves in such dilemma: they have both a plunge protection team in the equity market and a plunge enforcing team @ CRIMEX. While the QE lets PPT have a blast, PET is having their butt handed to them the past 6 weeks as a result. Maybe they really have to hold the leash on QE2 a bit to give PET a break.

Fri, 10/08/2010 - 08:00 | 634659 wafflehead
wafflehead's picture

Greenspan just said the deficit is a threat for American and we need austerity in this country. Who pays this fool to give speeches anymore?

Fri, 10/08/2010 - 09:51 | 634908 hugolp
hugolp's picture

If Greenspan wants austerity he should start by opposing the bailouts. Anyone demanding austerity while at the same time demanding deficit spending to bailout the banks is a lier.

Fri, 10/08/2010 - 08:02 | 634663 assumptionblindness
assumptionblindness's picture

The Fed is all rumor, little talk, and NO action.  They are out of bullets, therefore, bluffing is all that is left to do.  Yawn....

Fri, 10/08/2010 - 08:06 | 634667 jmf
jmf's picture

Moin from Germany,

 

is this the same Bullard that today has said this

Fed´s Bullard says "USD 100 Billion a month a ggod number to think about in terms of QE, better to move in small amounts"

I especially like the $ 100 billion a month runrate & small analogy ;-)

 

Fri, 10/08/2010 - 08:07 | 634668 bada boom
bada boom's picture

Message between the lines,

We are fucking with your head!

Fri, 10/08/2010 - 08:15 | 634680 caramel55
caramel55's picture

"...The Committee will continue to actively review its communication strategy, with the goal of communicating its outlook and policy intentions as clearly as possible..."

 


Fri, 10/08/2010 - 08:06 | 634669 living on the edge
living on the edge's picture

QE2 has already started, who else is funding the deficit?

Fri, 10/08/2010 - 08:12 | 634675 EscapeKey
EscapeKey's picture

One of the main internations buyers as of recent has been the UK. Of course, with the British deficit breaking records every month, there's nothing suspecious about this at all.

Fri, 10/08/2010 - 08:26 | 634693 living on the edge
living on the edge's picture

That is very suspicious in my eyes also, but further demonstrates how the fraud has been perpetuated with the help from some friends. Fits nicely with the rumored buyers in the Caymans.

Fri, 10/08/2010 - 08:05 | 634670 sushi
sushi's picture

Federal Reserve officials could wait until December

Endquote

December, what year?

Fri, 10/08/2010 - 08:11 | 634674 Hot Shakedown
Hot Shakedown's picture

QE 2 "Trial Balloon" complete....this and the Tepper CNBC gig were the  SELL signals for both paper and metal ... in my humble, long physical, opinion

Fri, 10/08/2010 - 08:22 | 634687 shushup
shushup's picture

Let's ask Bill Gross - he has already been told what the fed will do.

But without Gross' input I would think the futures would be much lower on this news.

Fri, 10/08/2010 - 08:23 | 634688 LeBalance
LeBalance's picture

Golly!  And all the "ve moost steeemulate invlation!" speeches from similar muckity mucks over the past two weeks was what?

Exactly what?

Fri, 10/08/2010 - 08:27 | 634696 RoRoTrader
RoRoTrader's picture

Clear as mud.

Fri, 10/08/2010 - 08:33 | 634700 Mad Mad Woman
Mad Mad Woman's picture

Bullard's an ass. The Fed cannot wait until December. This guy's a joke. And so is the Fed & Ben.

Fri, 10/08/2010 - 08:35 | 634710 flacon
flacon's picture

FED: "BLA, BLA, BLA, BLA Ph.D., BLA...."

Fri, 10/08/2010 - 08:36 | 634712 flacon
flacon's picture

Well SILVER LIKED THAT NEWS! 

Fri, 10/08/2010 - 08:42 | 634732 Dagny Taggart
Dagny Taggart's picture

I guess gold did, too.

Fri, 10/08/2010 - 09:19 | 634824 SheepDog-One
SheepDog-One's picture

There will be no money, but on your deathbed, you'll receive total conciousness. Or something.

Fri, 10/08/2010 - 09:27 | 634838 Jewelsnorth
Jewelsnorth's picture

Then there was Fisher's comments yesterday in Dallas (http://www.dallasfed.org/news/speeches/fisher/2010/fs101007.cfm)

"A great many baby boomers or older cohorts who played by the rules, saved their money and have migrated over time, as prudent investment counselors advise, to short- to intermediate-dated, fixed-income instruments, are earning extremely low nominal and real returns on their savings. Further reductions in rates earned on savings will hardly endear the Fed to this portion of the population. ... Debasing those savings with even a little more inflation than what is above minimal levels acceptable to the FOMC is unlikely to endear the Fed to these citizens."

Pitchforks everyone!

Fri, 10/08/2010 - 12:43 | 635575 DTCC 1999
DTCC 1999's picture

Good find.  What’s sad is the social umbrella for them is unfunded. 

I like Blanchard; his face and words have shown genuine care.  The Fed values him too; he goes on CNBC.      

Calendar of Federal Reserve Meetings (FOMC Calendar):
November 2 & 3, 2010 - Rate Announcement (ED: Maybe)- Wed. Nov. 3rd, 2:15 pm

http://www.rightline.net/calendar/FOMC-Calendar.html 

FOMC Statement from last August:

To help support the economic recovery in a context of price stability, the Committee will keep constant the Federal Reserve's holdings of securities at their current level by reinvesting principal payments from agency debt and agency mortgage-backed securities in longer-term Treasury securities.1 The Committee will continue to roll over the Federal Reserve's holdings of Treasury securities as they mature.
http://www.businessinsider.com/heres-the-crucial-paragraph-to-watch-for-in-todays-fomc-decision-2010-9 

Deep Thoughts by Jack Handy: The reason we continue talking as if politicians still serve a purpose, isn't because we don't know better, we just don't know how to act otherwise. 

Fri, 10/08/2010 - 09:31 | 634853 b_thunder
b_thunder's picture

Bullard is full of Bull-%$#@!

QU2 is coming, QE2 is here, and here to stay!

 QE in perpetuity

 

 

Fri, 10/08/2010 - 09:47 | 634900 tewkatz
tewkatz's picture

Obfuscation, my fellow irritating and/or lewd females which somehow coalesces us into a homogenous social group with the power to influence the rudder of America's financial future of which I am grateful to not so much contribute but mostly cheer from the sidelines!!!!

That reminds me, where is the donate button?

Donate, B*tchez!!!! 

Fri, 10/08/2010 - 10:07 | 634943 Dr. Engali
Dr. Engali's picture

It's a big game of chicken. Who will be the first to blink?

Wed, 10/27/2010 - 08:42 | 680125 daniel
daniel's picture

 

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