When we first learned Bernanke was considering a "QE II," and then at its enactment, and regularly following that event we have advised clients that since we were not in need of liquidity, that lack of liquidity was not the problem, this non rule-based activity would have two, and only two results: 1) inflate equity prices and 2) inflate commodity prices.
Dec/5/10 we stated that it was a gross error; that QE II would have little to no impact on the pace of recovery and two, that it was corrosive to Fed independence, a necessary item, the heart of monetary control because it was nothing other than an attempted bailout of Obama’s failed fiscal policy.
Now that the horse is long gone observers are growing suddenly sober. Look for the headlines to reflect this reality just ahead.
Robert Craven
Dec/5/10 we stated that it was a gross error; that QE II would have little to no impact on the pace of recovery and two, that it was corrosive to Fed independence, a necessary item, the heart of monetary control because it was nothing other than an attempted bailout of Obama’s failed fiscal policy.
Now that the horse is long gone observers are growing suddenly sober. Look for the headlines to reflect this reality just ahead.
Robert Craven
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