FOMC

Bernanke: No QE3 Wall Street, Congress Get it Together and We Need Jobs

bernakeFederal Reserve Chair Ben Bernanke gave testimony before the Joint Economic Committee and the doves fell from the sky. Bernanke cut short Wall Street's addict like demand for more quantitative easing and instead suggested a host of policies to boost hiring and real economic output.

On the labor markets, Bernanke's testimony validated our analysis, that one cannot blame the pathetic jobs market on the weather.

More-rapid gains in economic activity will be required to achieve significant further improvement in labor market conditions.

In fact, Bernanke suggested the next FOMC meeting discussion question will ask: Will there be enough growth going forward to make material progress on the unemployment rate?  This is good, Bernanke realizes the #1 threat to the U.S. economy is the jobs crisis.

The Fed Chair also warned on the ongoing sovereign debt crisis in the Eurozone:

We Told Ya So - FOMC Minutes Confirm No Quantitative Easing

We told ya so, yet people don't listen. The Federal Reserve FOMC meeting minutes were released and showed no quantitative easing for you.

Here is the money shot from the FOMC minutes:

A couple of members indicated that the initiation of additional stimulus could become necessary if the economy lost momentum or if inflation seemed likely to remain below its mandate-consistent rate of 2 percent over the medium run.

The FOMC has 10 voting members. The news is clear, those in favor or more quantitative easing are now 8 to 2 and if and only if the economy goes further into the tank.

Nevertheless, the staff continued to forecast that real GDP growth would pick up only gradually in 2012 and 2013, supported by accommodative monetary policy, easing credit conditions, and improvements in consumer and business sentiment

We're sure some will hold out hope against hope that more quantitative easing will happen. After all there are two members of the FOMC leaving the door open on more quantitative easing if the unemployment situation gets worse. That said, the next time you see some major investment group claiming QE3 is sure to arrive, check their interests and why that group is making such a claim. Alternatively just read us, we sure knew QE3 was not gonna happen.

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