There has been more and more speculation that the Fed is getting ready to launch a new QE program, this one targeting residential mortgages. With the data coming in better than expected, stocks back up, and Plosser and Bullard both chiming in that improving data would make them hesitate or question the need for more QE, there is some fear that it is off the table.
I don’t think it is off the table, and if anything see growing signs that they are trying to create the political will to get it done. Obviously some Fed members have been vocal about doing more, so the dissenters do have competition. Some of the usual “leak” sources have been indicating that it is possible, but that is not what got me more curious.
Today at least 5 commentators on Bloomberg were downplaying good data and stating that things can’t get much better without housing. I agree, but it seemed like a weird day for so many people to refer to housing. There was no housing data out today, and the jobs report was okay so it wasn’t obvious to point out the continued weakness in housing. Maybe after weeks of Europe and deficit talks, it was time for a new subject, but it just struck me as odd how often it came up. 2008 was easier, back before Bill Gross fell out of favor with the White House, because you knew whatever he said was an attempt to prepare people for a new policy. It is harder now to figure out who is setting the market up, but I find it hard to believe that it is a co-incident that “the need to fix housing” was on everyone’s lips.
So I think Bernanke is trying to lay the groundwork of why it is so important to buy mortgages.
Read the rest at TF Market Advisors
(h/t Zero Hedge)
No comments:
Post a Comment