QE3? Expect, at most, QE 2.1 at Fed meeting

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By Steve Goldstein, MarketWatch


WASHINGTON (MarketWatch) — The Federal Open Market Committee meeting on Tuesday, which just two weeks ago was expected to be an almost throwaway gathering, has suddenly morphed into a major event.

That’s what Thursday’s 513-point one-day hammering on the Dow Jones Industrial Average, followed by Monday’s 635-point nosedive, will do.

.....(snip).....

But Fed followers say there’s not much ammunition left in the central bank’s cannon. And more broadly, monetary policy isn’t really the problem.

“I don’t think you have a money problem right now,” said Jerry Webman, chief economist for OppenheimerFunds. “Monetary policy is about controlling the supply and price of money, and right now there’s ample supply, and money can be had at a very cheap price.” ..........(more)

The complete piece is at: http://www.marketwatch.com/story/qe3-expect-at-most-qe-21-at-fed-meeting-2011-08-08?dist=beforebell

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1. Recommend

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2. with craven (or stupid) folk like this at the helm, we are screwed.

The Fed will have weighed both the market’s slide as well as recent economic data, such as the deterioration in manufacturing sector sentiment and the weak gross domestic product reports for both the first and second quarter, said Karen Dynan, co-director of the Brookings Institution’s economic studies program and a former senior adviser to the Federal Reserve Board.

“The question for them is whether this is a soft patch or a sustained slump in activity,” she said. “We don’t know and they don’t know.”

The notion that they're even CONSIDERING this a 'soft patch' should scare the hell out of anyone paying attention. Perhaps if these wildly well-paid people "don't know" then perhaps we should get someone in there who does know.