Chairman Ben S. Bernanke and his colleagues are weighing the use of more untested policy tools after two rounds of bond buying totaling $2.3 trillion failed to spur sufficient economic growth and reduce unemployment below 9 percent. The Federal Open Market Committee holds its regular meeting today in Washington following the worst day for U.S. stocks since December 2008. “The odds of more dramatic action are higher,” said Vincent Reinhart, a former chief monetary policy strategist at the Fed. ...The Fed is likely to start a third round of asset purchases, ....“It’s going to move more decisively” than in the first two rounds, Rogoff said in an interview with Bloomberg Television. He recommended the Fed say it’s trying to create “moderate inflation” and avoid repeating that officials are trying to boost stocks. The Fed in June completed a $600 billion Treasury bond- purchase program aimed at reducing long-term borrowing costs on everything from car loans to mortgages and boosting share prices.Even with the purchases, the economy grew in the first six months of this year at the weakest pace since the recovery started in 2009. After almost stalling at a 0.4 percent annual pace in the first three months of this year, the economy expanded at a 1.3 percent rate last quarter, the government reported on July 29. Read full at BloomBergAug 12, 2011
Q3 deathblow for U.S. dollar - Bernanke weighing the use of more untested policy
Chairman Ben S. Bernanke and his colleagues are weighing the use of more untested policy tools after two rounds of bond buying totaling $2.3 trillion failed to spur sufficient economic growth and reduce unemployment below 9 percent. The Federal Open Market Committee holds its regular meeting today in Washington following the worst day for U.S. stocks since December 2008. “The odds of more dramatic action are higher,” said Vincent Reinhart, a former chief monetary policy strategist at the Fed. ...The Fed is likely to start a third round of asset purchases, ....“It’s going to move more decisively” than in the first two rounds, Rogoff said in an interview with Bloomberg Television. He recommended the Fed say it’s trying to create “moderate inflation” and avoid repeating that officials are trying to boost stocks. The Fed in June completed a $600 billion Treasury bond- purchase program aimed at reducing long-term borrowing costs on everything from car loans to mortgages and boosting share prices.Even with the purchases, the economy grew in the first six months of this year at the weakest pace since the recovery started in 2009. After almost stalling at a 0.4 percent annual pace in the first three months of this year, the economy expanded at a 1.3 percent rate last quarter, the government reported on July 29. Read full at BloomBerg