One of our favorite local economists and former Dallas Federal Reserve Bank chair, Robert McTeer was out with an excellent comment about the FOMC actions earlier this week. (We think as an Aggie, he might be on a roll…Johnny/Heisman?) No matter, from our perch, we agree, here is why.
Today the FOMC will make an announcement after the conclusion of their final two-day meeting of 2012. We think, again, members should do nothing, as we said here, here, and here before. This time with the afore-mentioned Fiscal Cliff pending, according to Robert McTeer which we strongly agree with, more easing let’s our politicians slightly off the hook. “Positive measures would only help enable further inaction. ….Doing something will be tempting since the FOMC’s so-called operation twist is scheduled to expire at year-end” Agree, 100% even further more, we do not think the last round of easing was necessary, but we digress.
Not to jump on the McTeer train, but his final comment is our continued concern “If it becomes necessary, it can be done after the 2013 recession begins.” We have long worried about taking the QE medicine in more sanguine times and what is left if something REALLY bad should happen.
Here are the diminishing results of the QE’s per chartstore.com
As you can see, each QE has resulted in less and less of an effect. Hold off boys and let the bureaucrats clear a path…We believe they can/will!
Have a great day!
JK214-706-4300 www.jkfinancialinc.com 8222 Douglas Ave # 590 Dallas, TX 75225