- FOMC seeks consensus for actions
- Doesn’t think QE is terribly effective
- Would like policy to be state contingent but is difficult to fine tune policy
- September was an example of how hard it would be to fine tune policy
- May be in favour of setting a limit for bond buying program
- Could announce a dollar size to QE3 that would halt it soon
- Hurdle very high on possible QE increase
- Fed not seen breakout in growth it expected
- Tying QE to jobless could mean long time for program
Philly Fed’s Charles Plosser speaking to CNBC and the first of several Fed members due to speak today and hopefully spill the beans on the FOMC thinking.
That’s an interesting thought from Plosser on a way the Fed could start to wriggle out of the massive hole many see them digging themselves into. They need to get out of the “unlimited” trade and into something more manageable and setting out a possible monetary target may help. It would be just another name for tapering but if they gave it something like a year or two year target ,where they say that QE will stop, then they may give themselves a chance to get out. Obviously they could say that they’ll start printing again if they need to.
