FOMC Minutes, And Goldman's Take: Improving Economy Not Enough To Remove QE
No reaction on the FOMC minutes, as expected, which basically say that despite the "economic improvement" the Fed does not have confidence in the eceonomy to remove QE. Also, QE is supposedly successful because rates went up, even though the whole purpose of QE is to get rates down. Total idiocy.
Here is Goldman's take on the FOMC minutes:
1. Perhaps the best single sentence in this document is the one that immediately precedes the vote on the directive to the New York Fed for its intermeeting operations: "With respect to the statement to be release following the meeting, members agreed that only small changes were necessary to reflect the modest improvement in the near-term economic outlook." In this regard, we remember expecting the committee to upgrade its view only modestly and finding that the upgrade was, if anything, a bit more cautious than we anticipated.
2. These minutes confirm that tone throughout. Indeed, somewhat to our (small) surprise, the staff forecast for growth changed little on balance for 2011 and 2012 as the incorporation of a more accommodative set of fiscal was essentially offset by the growth inhibiting effects of lower home prices and housing activity and higher oil prices and interest rates. Committee members were likewise cautious in their upgraded views on growth. While concerns about deflation abated and some expressed the usual concerns about possible upside surprises, the overwhelming sense was that inflation would remain low and progress toward the committee's twin objectives of high employment and somewhat higher inflation was disappointingly slow. Accordingly, with the expected dissent of Kansas City President Thomas Hoenig, the committee saw no reason to change policy settings.
Full minutes below:
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