Bernanke Says Accommodative Policy Needed for ‘Uneven’ Recovery (QE3 Anyone?)

June 7 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said the central bank should maintain record monetary stimulus to boost an “uneven” and “frustratingly slow” economic recovery. “The economy is still producing at levels well below its potential; consequently, accommodative monetary policies are still needed,” Bernanke, 57, said today in the text of a speech to a conference in Atlanta. “Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established.”

Bloomberg

Not sure about most of you, but this has QE3 written all over it! All I can say at this point is bye bye USD! I think everyone knew it would happen it was just a matter of how they would package it. The fed is currently in a lose, lose situation while being stuck between a rock and a hard place on what their option are to get out of the mess they have created.

The things they would normally do to combat inflation is raise rates, but they can't do that right now because it would surely send us back into a deep recession/depression. They can't just cut off the spending from QE2 at this point either, because then the real numbers would start to come out and it would send the markets into a tail spin.

ETA: This is probably why China among others have begun selling off their treasury holdings. This will spell massive inflation if they do proceed with a QE3 similar to QE2.

Yep, QE 3, QE 4 baby.... print some for me too, woo hooooo!!

QE to the Moon, for a short brake, then continue to Infinity

Wow I really thought that people would care more about this. Looks like everyone is sick of hearing it and are already preparing for the worst.

Well he did already say the other month that monetization policy would continue after the QE2 deadline, as the US economy could not take interest rate rises. and would fall back into recession.

They might not call it QE now. but it is the same thing.

Problem is. if they dont sort out the debt ceiling issue. there won't be a need, as the treasury could not issue bonds.

UNLESS they are just arranging to buy back bonds from China, who has strangely been flipping BILLIONS in recent weeks!

Result is still the same, More dollars on the market as the Chinese just turn around and buy something valuable...like gold.

reply to post by SpaDe_


Of course, how else are they gonna pay for building up the BRIC countries, silly?

Keep the cash flowing!

They will have to. Its that or fix things. I doubt anything will get fixed any time soon.

Originally posted by SpaDe_

Not sure about most of you, but this has QE3 written all over it!

I'm with you SpaDe, and it's kind of obvious that Bernanke's reference to extended accommodation was intended to halt the current bleeding in the stock market. Equities have been begging for a reason to rally, and this informal utterance could be enough to appease the market for at least a session or two....or not. However jawboning asset prices won't work forever, especially in the face of deteriorating economic indicators. So I'll bet my bippy that QE3 in whatever form is already being prepped at the pipeline.

Got Gold ?

GL

A potential signal for further monetary stimulus, aka, Quantitative Easing

Originally posted by OBE1

Got Gold ?

GL

I was late to the party on gold, so I jumped on silver instead. They are both solid investment, but silver tends to be more volatile than gold.

Originally posted by SpaDe_
I was late to the party on gold, so I jumped on silver instead. They are both solid investment, but silver tends to be more volatile than gold.

Silver be good. As you inferred SpaDe, just be prepared to white-knuckle-it.

GL