por admin » Jue Sep 13, 2012 9:13 pm
Bernanke sin limites
El Fed entra a bravo, nuevo mundo de ilimitada politica monetaria
Y en que quedo el miedo de que el Fed podria desilusionar a Wall Street, Bernanke y el Fed se pusieron los sombreros de fiestas y desencadenaron una ilimitado programa de politica monetaria. El movimiento excede las expectativas de Wall Street, pero dudamos que pueda ayudar a la economia real a largo plazo.
Esta es la tercera ronda de quantitative easing (QE3) desde el panico del 2008, y la diferencia esta vez es que Ben no tiene limites. El Fed dijo que mantendra los intereses cerca a cero por lo menos hasta mediados del 2015, lo cual es seis meses mas que lo que anunciaron anteriormente. La noticia mas grande es que el Fed anuncio otra ronde de compra de bonos - esta vez mas alla de lo que nuestros ojos pueden ver.
El Fed empezara a comprar $40 billones de hipotecas adicionales al mes, con el objetivo de reducir aun mas los intereses a largo plazo. Peri si el mercado laboral no mejroa sustancialmente, el Fed comprar aun mas bonos. Y si no funciona, comprara aun mas. Y si .....
El anuncio del Fed pone mas enfasis en la creacion de empleo que en su otro mandato, estabilidad de precios con inflacion controlada.
En resumen el Fed le ha dado un regalo de reeleccion a Obama.
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Bernanke Unbounded
The Fed enters a brave new world of unlimited monetary easing
So much for fears that the Federal Reserve might disappoint Wall Street. Chairman Ben Bernanke and his music men at the Fed's Open Market Committee put on their party hats Thursday and unleashed an unlimited program of monetary easing. The move exceeded even Wall Street's expectations, but whether it will help the real economy in the long term is doubtful.
This is the Fed's third round of quantitative easing (QE3) since the 2008 panic, and the difference this time is that Ben is unbounded. The Fed said it will keep interest rates at near-zero "at least through mid-2015," which is six months longer than its previous vow. The bigger news is that the Fed announced another round of asset purchases—only this time as far as the eye can see.
The Fed will start buying $40 billion of additional mortgage assets a month, with a goal of further reducing long-term interest rates. But if "the labor market does not improve substantially," as the central bankers put it, the Fed will plunge ahead and buy more assets. And if that doesn't work, it will buy still more. And if . . .
The Fed statement paid lip service to pursuing its "dual mandate" of controlling inflation and reducing unemployment, but no one should be fooled. The Fed has declared that it is going all-in to cut the jobless rate, no matter what it takes.
"We have to do more, and we'll do enough to make sure the economy gets on the right track," Mr. Bernanke declared at his Thursday press conference. That bravado contradicts the Chairman's by now routine caveat that monetary policy "is no panacea" and can't save the economy by itself, but no matter. He's going to try.
Will it work? Mr. Bernanke recently offered a scholarly defense of his extraordinary policy actions since 2008, and there's no doubt that QE1 was necessary in the heat of the panic. We supported it at the time. The returns on QE2 in 2010-2011 and the Fed's other actions look far sketchier, even counterproductive.
QE2 succeeded in lifting stocks for a time, but it also lifted other asset prices, notably commodities and oil. The Fed's QE2 goal was to conjure what economists call "wealth effects," or a greater propensity to spend and invest as consumers and businesses see the value of their stock holdings rise. But the simultaneous increase in commodity prices lifted food and energy prices, which raised costs for businesses and made consumers feel poorer.
These "income effects" countered Mr. Bernanke's wealth effects, and the proof is that growth in the real economy decelerated in 2011. It decelerated again this year amid Operation Twist. When does the Fed take some responsibility for policies that fail in their self-professed goal of spurring growth, rather than blaming everyone else while claiming to be the only policy hero?
Then there are the real and potential costs of endless easing, three of which Mr. Bernanke addressed at his Thursday press conference. He said Americans shouldn't complain about getting a pittance of interest on their savings because they'll benefit in the long term from a better economy spurred by low rates. Retirees might retort that they know what Lord Keynes said about the long term.
Mr. Bernanke was also as slippery as a politician in claiming that his policies don't promote deficit spending because the Fed earns interest on the bonds it buys and hands that as revenue to the Treasury. Yes, but its near-zero policy also disguises the real interest-payment burden of running serial $1.2 trillion deficits, while creating a debt-repayment cliff when interest rates inevitably rise. Does he really think Congress would spend as much if he weren't making the cost of government borrowing essentially free?
The third cost is the risk of future inflation, which Mr. Bernanke accurately said hasn't strayed too far above the Fed's 2% "core inflation" target. That conveniently ignores the run-up in food and energy prices, which consumers pay even if the Fed discounts them in its own "core" calculations.
The deeper into blacklisted_site monetary easing the Fed goes, the harder it will also be to unwind in a timely fashion. Mr. Bernanke says not to worry, he has the tools and the will to pull the trigger before inflation builds.
That's what central bankers always say. But good luck picking the right moment, which may be before prices are seen to be rising but also before the expansion has begun to lift middle-class incomes. That's one more Bernanke Cliff the economy will eventually face—maybe after Ben has left the Eccles Building.
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Given the proximity to the Presidential election, the Fed move can't be divorced from its political implications. Mr. Bernanke forswore any partisan motives on Thursday, and we'll give him the benefit of the personal doubt. But by goosing stock prices, and thus lifting the short-term economic mood, the Fed has surely provided President Obama an in-kind re-election contribution.
The irony is that, with this historic and open-ended easing, Mr. Bernanke is also tacitly admitting how lousy the Obama-Bernanke economy really is. For all the back-slapping by the Fed and the White House about how they've saved us from a Great Depression, four years later the Fed is acknowledging that the recovery is rotten, that job creation stinks, and that their policies haven't helped the middle class. But, hey, it's great for Wall Street.