The Fed cannot and will not announce QE 3 barring a market bloodbath or major failing. It certainly won’t announce QE 3 when commodities prices never really cooled down from their QE 2 highs.
Commodities as a whole are only 8% off their QE 2 highs. Some commodities are actually higher than during QE 2. If the Fed were to announce QE 3 in this environment is would KILL the US Dollar and the US consumer. End of story.
So instead, the Fed is engaging in verbal interventions, trotting out guys like Evans who, if he were a Doctor, would be in jail for malpractice. Only in economics can you be completely wrong and promote ideas that make people starve and lose their retirements and not be arrested.
After all, why announce QE 3 when you can get the exact same impact just from speaking in public? It’s a heck of a lot easier. And it doesn’t involve people rioting and the economy imploding (yet).
So if you’re banking on QE 3 coming in September, you’re in for a rude surprise. Unless the S&P 500 craters to below 1,100 in the next three weeks, QE 3 ain’t coming.
The Fed has already gone too far with QE. QE 2 spent $600 billion and didn’t accomplish anything (as I and several commentators have recently noted). The Fed’s balance sheet (roughly $3 trillion) is already larger than the economies of the UK and Brazil. Has anyone bothered to ask how exactly the Fed going to unwind this? Everytime the Fed halts QE the markets implode. Do you really think the Fed could withdraw even $1 trillion in liquidity without forcing systemic collapse?
Folks, we’ve already crossed the Rubicon on Fed intervention. There is no way we can undo what the Fed’s done. All that is left is the inevitable debt restructuring and market collapse. The Fed will be dismantled within five years (if not, it will be significantly reformed). Bernanke is going to be stepping down within 18 months and possibly facing lawsuits.
This is the facts of the matter. The QE 3 debate is pointless. We’ve already begun the End Game for the Fed and its interventions. Sure, we might prop things up here and there temporarily, but the great unwind has begun.
Indeed, I fully believe we are about to enter into the next leg down for this Crisis. The financial system is on DEFCON Red Alert (no matter what stocks are doing). And smart investors are taking steps to prepare themselves and their portfolios NOW while the markets are still holing up.
If you have yet to prepare yourself for what’s coming, my Surviving a Crisis Four Times Worse Than 2008 report can show you how to turn the unfolding disaster into a time of gains and profits for any investor.
Within its nine pages I explain precisely how the Second Round of the Crisis will unfold, where it will hit hardest, and the best means of profiting from it (the very investments my clients used to make triple digit returns in 2008).
Best of all, this report is 100% FREE. To pick up your copy today simply go to: http://www.gainspainscapital.com and click on the OUR FREE REPORTS tab.
PS. We also feature four other reports ALL devoted to helping you protect yourself, your portfolio, and your loved ones from the Second Round of the Great Crisis. Whether it’s my proprietary Crash Indicator which has caught every crash in the last 25 years or the best most profitable strategy for individual investors looking to profit from the upcoming US Debt Default, my reports covers it.
And ALL of this is available for FREE under the OUR FREE REPORTS tab at: http://www.gainspainscapital.com.