will there be a QE 3 ?

this is common as investors right now are confused....will there be inflation or deflation so people don't know what to do......but I already know that Bernacke won't allow deflation to take hold and let the banking system implode!

 

so long as this is not the end of the game then I will hang on for the long haul.

 

yup.....I still think QE will be announced soon........Bernacke has no choice!

 

I am not so sure.

Last time (2008 ) all the governments of the world seemed to be falling all over themselves to 'stimulate' and 'bailout'.

This time, they seem far more hesitant.


Oh, I think there will be QE3 (or whatever they will call it). What else can they do? Admit all this Keynesian spending has not worked? That all it did was delay the inevitable by costing future generations trillions of dollars? I HIGHLY doubt it.

But I have a gut feeling (though I am by no means secure in this feeling) that they will not do it until a recession has either started or is 100% certain to begin.


Also. I cannot believe that Obama did not tell Bernanke;

'Hey, when you do your QE3? Don't start it too far away from the election so that it's effects start wearing off before November.
Wait as loooong as you can...okay?'

I think that is possibly why the Fed is doing these little Mickey Mouse semi-QE's; promising to keep rates low until 2013, Operation Twist.

They are trying to keep the recession at bay for as long as possible (maybe spring 2012) and then launch a full out QE3 that will stimulate the economy just at the right time so as to help the Democrats (who clearly like Bernanke more then the Republicans do) the most right around November, 2012.

It's just a guess/hunch.

But if I am at all right (and I am NO EXPERT AT ALL), then gold/silver have a LONG way to drop still.

Oh well, we shall see.

 

The thing that is driving the market over the past couple weeks isn't worry about inflation. It's worry about whether Europe can deal with its debt problems and whether it won't and bring the world economy down.

 

although I see your point as QE has become very unpopular right now, the problem is the longer you wait, the deeper in the hole the economy goes and so you need more stimulus than previous. Going back to what I told Iriemon about the tire with the hole in it....the longer you wait to put in air, the more flat the tire becomes and the more air ( QE ) you need to raise the tire ( the economy) again!

 

exactly, and if greece defaults what happens?
many write offs and many banks becoming insolvent...this will cause currency to be destroyed via the write downs of bad loans and the same chain reaction that happened after Lehman will occur all over again...so do you still think QE wont happen? The air is getting low in the tire Iriemon

 

I agree.

That's why I think they are doing these semi-QE's..so that a) they can put off the big QE until nearer the election and b) the big one will not have to be as big; or more importantly - seem as big to the masses.

Even I don't think the Fed is so monumentally ignorant that they actually believe that Operation Twist was actually the cure for the economy.

Especially when every single major Keynesian on the planet seems to be screaming the same thing...the last Stimulus/QE's were too small. We need MUCH MORE MONEY...

Sheesh...Major Keynesians like Krugman or Helicopter Ben...mooching moochers that are the biggest moochers since Marvin the Mooching Moocher had quintuplets with Mary the Mooch.

 

My guess? I think anoher trillion is needed.....and this is the problem......if thay announce such a large QE it might spook the markets....especially the bond market and commodities........so its quite possible they will annouce two or three smaller ones...or even lie about it and say its only 600 billion and then after the election revise it upwards....anything is possible with those crooks!

 

You might be right.

I really do not know.

My big question is...what happens when this latest QE does not work?

What then?

Eventually they will run out of QE's and then all heck breaks loose.

I wonder what it will look like?

I have NO idea other then it will probably make the Great Recession of '08 look like an absolute walk in the park.

 

this is exactly why I am predicting a currency crisis in either 2012 or 2013.....QE 3 won't work....guaranteed....it will only buy time....so then by next summer or fall we are back at this point in time. So now, do they introduce QE 4 ? At some point either being QE 4 or QE 5 or even QE 6 the bond vigialanties will throw in the towel and dumpt treasuries...then the fed has one of two choices....let interest rates rise substantially and the whole banking system implodes, or buy up all those dumped bonds.....hyper-inflation. You see....what Iriemon doesn't understand is I have thought this through and I think this is all very likely to happen in the next couple of years!

 

QE 3 will probably happen if they get their Jobs Bill passed. They'll have to increase the debt ceiling 'again' in order to do it.

 

nah...by the time they raise the debt cieling again, it will QE 4 or even QE 5

 

Imo, the US government (and many EU countries?) will probably initiate some sort of major war or huge military incident to divert Americans attention away when/if that situation arises.

Every politician with any political sense knows that a currency crisis probably means the end of their careers.

And I truly believe that most major politicians would rather start a war then give up their power.

 

many have said thats why we had WW2 to divert people's attention away from the economy!

 

The S&P 500 closed below 1100 on Monday...lowest close in over a year.



http://www.bloomberg.com/apps/quote?ticker=SPX:IND

 

S&P is always late to the party.

 

you mean the ginto party LOL?

 

although anything is possible, I can't see the markets collapsing as Bernacke will do whatever it takes to make sure the markets don't tank.....even if it means massive stimulus!

 

Yep that's the one!

 

and I suppose that will mean even higher gold prices?

 

of course

 

I personally do not think anytime soon though, unless the various governments/other central banks start spending a WHACK more money.

http://www.politicalforum.com/4541041-post1.html


It looks like QE3 is still some ways off.

 

He did his part by keeping interests rates low for another two years. What more do you expect out of him?

 

I expect him to do exactly what he is doing...where did I say otherwise?

I expect him to continue to act like a macro-economic ignoramus of the first magnitude.