Posted by WARREN MOSLER on 30th July 2010
It’s not just him, the all say ‘quantitative easing’ will ‘work’ when they should now have enough evidence and theory to know all it does is lower interest rates which are already plenty low with regards encouraging lending.
Might just be managing expectations but more likely they still actually believe it.
*DJ Fed’s Bullard: Worried About Possible Deflationary Outcome For US(DJ)
*DJ Bullard: Says More Quantitative Easing Will Work(DJ)
*DJ Bullard: Says Deflation Not Most Likely Economic Scenario(DJ)
*DJ Fed’s Bullard: Most Likely Scenario Is That Recovery Will Continue(DJ)
*DJ Bullard: Acknowledges Weaker US Data Over Last Two Months(DJ)
*DJ Bullard: Euro Zone Has Done Reasonable Job Containing Crisis(DJ)
Posted in Fed, Interest Rates | 5 Comments »
Posted by WARREN MOSLER on 30th July 2010
Karim writes:
Bullard
- Definitely out there on his own. FRB would certainly not communicate policy shift through him
- Also, everyone has different reasons why QE works. Most of the Fed leadership thinks just via interest rate channel and announcement effect. Bullard thinks through monetary channel, which makes him a minority.
GDP Data: Something for everyone; capex recovery intact; consumer spending sluggish; net exports a large drag; inventories an offset
- Annualized gwth at 2.4%; Q1 revised from 2.7% to 3.7%; Prior data revised lower
- Private consumption 1.6% vs 1.9% in Q1; Investment up 28.8% vs 29.1% in Q1
- Business capex (equipment and software spending) up 21.9% vs 20.4% in Q1
- Residential fixed investment (housing) up 21.9% (aided by expiring tax credit)
- Exports and imports both up in double digits, but net exports a drag on growth of -2.78%
- Inventories contribute 1.05%
Posted in Fed, GDP, Government Spending | 1 Comment »
