The PJ Tatler

Fed Really is Out of Bullets

From “independent speculator” Jeff Carter (unfortunately this is the kind of guy with real experience that makes you believe him):

If there is anything today’s market action ought to tell you, it’s the Federal Reserve is really out of bullets. They have become a knife fighter in a battle with machine guns. In their statement today, they said, “low rates of resource utilization and a subdued outlook for inflation over the medium run” warrant maintaining current rates until “at least” 2013.”.

Three Fed governors dissented, something that hasn’t happened since 1992. They would have preferred that the statement read, “likely to warrant exceptionally low levels for the federal funds rate for an extended period.”.

The statement also hints at a continuation of QE2. That is simply the monetization of the debt, and an expansion of the money supply.

What do we do now, Jeff? Just buy more gold and Apple stock?