from Gold Money:
Another Ben Bernanke performance in front of the US Senate momentarily caught the attention of financial markets yesterday, up until the point when it became clear that the Fed wouldn’t be liquoring up the joint with more QE just yet. Despite the litany of bad economic stats in the US over the last three months or so, Bernanke noted that “we haven’t really come to a specific choice at this point” (regarding more stimulus), though he commented that “we are looking for ways to address the weakness in the economy should more action be needed.”
Over at The Big Picture blog, Peter Boockvar summed up the state of play regarding the Fed and “QE3” well, prior to Bernanke’s testimony:
“As long as cheap money/QE remains in the psyche of most of our current Fed members, including the Chairman, as the answer to any economic downturn, its use will always be a possibility with only the pain threshold that triggers it being the question. Today we’ll get a sense of Bernanke’s tolerance for what’s clearly a slowing in growth. If Bernanke doesn’t give the market what it wants today, the ensuing market selloff in the context of a fragile economy will just clinch an eventual QE program [sic].”
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