Federal Reserve expected to announce QE3 Thursday

Get short URL

Published time: September 12, 2012 18:44
Edited time: September 12, 2012 22:44

Chairman of the US Federal Reserve Ben Bernanke (AFP Photo)

Tags

Banking, Economy, Employment, USA

Following months of persistent rumors, economy experts across America predict that the US Federal Reserve will finally announce plans for a third round of quantitative easing, or QE3, on Thursday.

Almost two-thirds of the economists polled by Bloomberg News this week say that they predict another round of quantitative easing to be announced on Thursday. Less than a week earlier, Goldman Sachs issued a statement from their offices in which the banking giant said they also expected the Fed to announce QE3 in the coming days.

The members of the Federal Reserve, the US central bank, have just begun meeting in New York City, where they are expected to make an announcement next week.

Quantitative easing, an attempt at stimulating the economy usually by means of purchasing bonds, has been discussed with the Fed time and time in recent years, even after the recession was officially considered over and done with in 2009. As rampant unemployment has devastated the US economy throughout the tenure thus far of President Barack Obama, the Fed has hinted several times at starting QE3, although even the members of the bank themselves aren’t certain what good, if any, will come from it.

Last week, Goldman Sachs said, “With today’s August employment report showing a nonfarm payroll gain of 96,000 and an unemployment rate of 8.1% because of a drop in the participation rate, we expect a return to unsterilized and probably open-ended asset purchases at the September 12-13 FOMC meeting.”

But although many economists say an announcement confirming QE3 is all but certain, the impact it would have on the country’s financial woes remains unknown.

“The economy is looking lackluster, and the Fed has said all along that they feel it’s almost immoral that the unemployment rate is as high as it is,” former San Francisco Fed economist Nick Sargen tells Bloomberg, adding that the central bank “clearly wants to do more,” but might not yet know how to do as much. The last two rounds of quantitative easing have been considered relatively unsuccessful by some, with bond purchases amounting to $2.3 trillion still unable to propel the country back out of the red.

"QE1 failed, QE2 failed, so I'm not so sure they would announce QE3, because they'll look like fools again," noted investor Jim Rogers tells Yahoo.

Ben Bernanke, the chairman of the Federal Reserve, will address the media on Thursday afternoon.

Comments (20)

SNAFU (unregistered) 17.09.2012 15:34

RT is driving me nuts with praise for Miller the killer, but they have had some great finance discussions during the last week. Joshua Mellors, Marc Faber, Reggie Middleton, and Edward Harrison really have a great way of clearing the smoke and predicting possible outcomes. Edward has the guts to say that buying personal gold in anticipation of some alternative trading system is BS. We can't even send an email without Big Brother reading it, but the Tea Party and Libertarians think gold will be used as money in hard times.

I can just imagine police or US soldiers questioning the gold and silver dealer now, "Tell us who sold you this gold or we'll rape your wife and daughter." If they kill little girls and women collecting firewood and bomb weddings, over and over, with Israeli-style militancy and complete lack of empathy and morality, why are they going to be any different during a domestic crisis or war?

Undo

2cents (unregistered) 17.09.2012 10:43

End the criminal Fed cartel worldwide. A soverign country
can print its own money.

Imagin e this. If the US ended its Fed n printed its own dollars,
there would be no interest added like the Fed does. The
reason for the IRS is to pay off the Fed interest. Since
A=B=C, then ending the Fed means ending the IRS. Just
imagine how the US economy would grow if the IRS didnt
tax u to death.

Undo

teddyformusic 17.09.2012 05:10

I do not think economics is as complicated as the 'experts' say it is......... talking about "recession" caused by "low demand" simply means, or SHOULD mean: A LOW WAGE Economy (which is what the world is under capitalism due to "supply side economics" favoritism ) , an economy that is based on SUPPRESSING wages -- inevitably LEADS to "low" demand or "insufficient deman" for the very services and goods that the "actors" in the REAL economy produce themselves...======= ====== the "finance economy" SHOULD be a UTILITY -- simply a means of exchange of demands -- but INSTEAD - under capitalism , especially that promoted by "expert america" and enforced globally (through various means, such as imperialism , monetarism, privatization, and finally wars) -- become an "economy in the clouds" -- played by the "finance" players -- which has LITTLE direct bearing on the ABILITY of common folk to be enabled to make "sufficient demand" for the goods and services THEY produce.... simply: LOW WAGE Economy, or "downward wage pressure" -- as capitalism dictates in order to "protect money capital" -- IS the central cause of "low and insufficient demand" ................. i f one does not have enough in wages -- one simply can not buy bread as one would "demand" or "need".......less so buying a car, or a vacation, or health care, or even a haircut every 2 weeks ......... money does not change hands "as fluidly" in the REAL economy because LOW WAGE economy people can not afford to "buy" , to "demand" -- what the Financiers DICTATE OUGHT to be "present" ("good, high demand")............ the CULPRIT? it is NOT ordinary folks who try to work or find jobs that are SUFFICIENT in wages --- it is the BUSINESS CLASS led by the Financiers and Big Business and Corporatocracy , and their friends in the "money capital" system that are the real culprits. all other 'explanations' -- be they in Harvard or Yale or Berlin -- are mumbo-jumbo.

Undo

View all comments (20)