Death Toll Revised Down to 24 After Monstrous Oklahoma Tornado…Hundreds Injured…Children Among the Dead…Some Drowned…Heartbreaking Pictures…Reporter Struggles to Share Terrible News

Listen Live: Glenn Beck Broadcasts From Impact Zone in Oklahoma

Business

Here’s Why You Should Expect QE3 (More Money Printing) on Wednesday

Sep. 11, 2012 3:12pm Guest Post

More Quantitative Easing This Wednesday?

CNBC.com Senior Editor John Carney

[Editor’s note: the following is an article by John Carney that originally appeared on CNBC.com]

The most talked about subject on Wall Street today is the question about whether the Federal Reserve will announce a new round of quantitative easing, or QE3.

More and more professional market watchers are predicting QE3. Goldman Sachs says the chances are greater than 50 percent. Barclays, UBS and JPMorgan are all predicting a new round of Fed asset buying.

The dissenters here are Nomura, the readers of Business Insider, and my old BI colleague Joe Weisenthal. I think Joe and Nomura are wrong — but before getting into that, here are Joe’s reasons for predicting no QE:

The economy still appears to be getting better. Citi’s Economic Surprise Index has gone positive, and continues to rise.

Unemployment fell to 8.1%. You might say this is meaningless, since it was a result of people leaving the workforce, but that doesn’t change the fact that if the workforce is shrinking that rapidly, then the labor pool is marginally closer to full employment, thus creating inflation risk. The Fed might also wonder (as others have) whether the weak NFP number was the result of a bad seasonal adjustment, rather than an underlying reflection of the economy (other labor market indices were quite solid during the month).

Meanwhile, the ECB just did the #1 thing that was needed for the global economy by taking the tail risk off the table with its bond buying program. That’s FAR more important and impactful than anything the Fed could do right now.

In the post Michael Woodford-era (Woodford being the economist who advocated NGDP targeting at the recent Jackson Hole conference), the Fed might feel as though a language change is the more robust move it can make.

The bar is probably high due to the electoral scrutiny. Easing in December will be much more palatable, and the Fed will also have more clarity as to how the Fiscal Cliff will be resolved.

Asset prices are at multi-year highs, and again, with the help of the ECB, financial conditions are quite easy.

So where does this analysis go wrong?

It assumes that the base case is No More Easing. Joe is basically looking for the recent data to provide a compelling case for further easing. That’s also what Nomura is doing when it says that the data doesn’t show job growth falling off the cliff.

The problem with this assumption is that we know that the base case is quite different. Here’s what the Fed said in the August FOMC [The Federal Open Market Committee] minutes: “Many members judged that additional monetary accommodation would likely be warranted fairly soon unless incoming information pointed to a substantial and sustainable strengthening in the pace of the economic recovery.”

In other words, the Fed is no longer looking for data to justify further easing. That was the story last spring. Now the Fed is checking the data to see if the data undermines the already established case for further monetary accommodation.

If you read the BI bullet points above through that lens, the situation changes altogether. Nothing in the data provides any reason to think that we have a “substantial and sustainable strengthening in the pace of the economic recovery.”

So, as loathe as I am to agree with the Wall Street consensus, this time Wall Street is right. We’re very likely to get a new round of QE tomorrow.

–

RELATED:

In CONTROL, Glenn Beck presents a passionate, fact-based case for guns that reveals why gun control isn’t really about controlling guns at all; it’s about controlling us. Find out more HERE.

Back to The Blaze »

Comments (75)

MrKnowItAll
Posted on September 11, 2012 at 4:36pm
Everything is fine. Teacher’s are refusing 16% raises. Times must be good. Right?

Report this comment
Log in to ReplyReply
- mwhaley
  Posted on September 11, 2012 at 6:41pm
  Hold on! Cash for clunkers was a complete success. It took off 96% of the Obama bumper stickers off the road.
  
  Report this comment
- honor007
  Posted on September 11, 2012 at 8:50pm
  Noone will be watching because of the crap going on in Libya and Egypt and Israel. The other hand is very sneaky.
  
  Report this comment
OneTermPresident
Posted on September 11, 2012 at 4:20pm
January of 2007 the Democrats took control of both houses of Congress. January of 2009 they have full control of both houses of Congress and now the oval office too. They controlled everything until January 2011 when the Republicans took back the House of Representatives. Taking back the House hasn’t done much because Harry Reid and the Democrats still control the upper chamber and Harry makes sure that any legislation written by the House is DOA at the Senate…. and Obama is still president.

Things have been great since January of 2007… right?

Report this comment
Log in to ReplyReply
- watersRpeople
  Posted on September 11, 2012 at 4:32pm
  And even still when Democrats had the entire Congress and the White House they still couldn’t get all their agendas through, and Democrats knew their base of voters would still blame Republicans. But likewise the base of Republican voters still blame Democrats. The average American is a dumb cow. That’s why Progressives wanted everyone to be able to vote in the first place as if to simultaneously poke fun at dumb voting Americans while they lead you to the slaughter. You know God doesn’t care about your vessels, right? God doesn’t care about the things people love, God doesn’t care about your homes, doesn’t care about your type of car, and God is not a respecter of nations.
  
  Report this comment
- Anonymous T. Irrelevant
  Posted on September 11, 2012 at 5:27pm
  Well, I know a lot of unemployed people, now. TARP 1 & 2, QE 1& 2 didn’t work, what makes these dunderheads think another round will work? PLEASE, get everyone you know to get out and vote the boy-king out of office!
  
  Report this comment
- MCDAVE
  Posted on September 11, 2012 at 7:06pm
  QE 3 is just another rip off of the taxpayers…Obama will give it away to his supporters and try to buy the election..plus he will get all the money he needs to campaign with…never mind it will cause hyper inflation and more unemployment.
  
  Report this comment
hauschild
Posted on September 11, 2012 at 4:12pm
I don’t see QE3 happening not only because it will be a fruitless short-term effort, but becuase the market has been doing fairly well over the past several months. I guess what I feel (donning my “progressive” cap) is that there is essentially nothing served at this time with another round of quantitative easing, so why not save the bullets (or more aptly – “blanks”) for when their asses are really on the line???

You have to keep in mind that progressives aren’t stupid; they just don’t understand their limitations, and this is what makes them so dangerous.

Report this comment
Log in to ReplyReply
- watersRpeople
  Posted on September 11, 2012 at 4:23pm
  It’s not that they are stupid, but that they don’t care about you only caring about themselves. They probably say to themselves: well I have this home in this other country so I don’t care what happens to Americans. The part I don’t think they understand is the whole world will burn wildly when the U.S goes down consuming them also.
  
  Report this comment
- smokeysmoke
  Posted on September 11, 2012 at 4:24pm
  i disagree with the analyssis of a better market… the dow is up from its 7000 lows… but on the down side gold is up about 900 dollars and the dollar index is down 10% over the past 4 years,,, EVEN AS THE WHOLE WORLD HAS BEEN PRINTING CURRENCY AND DEVALUING AT THE SAME TIME TO HIDE THE CHANGES IN CURRENCY… i do not see this as an improvement, but rather the dow is doing what it should as the dollar falls and gold rises… big buisness does well and is fairly recession proof… IT IS IN NO WAY AN INDICATOR OF MAINSTREET
  
  Report this comment
- watersRpeople
  Posted on September 11, 2012 at 4:36pm
  God isn’t going to say to himself: Oh look, they have an idea for another invention – oh let me give them more time.
  
  Report this comment
- Rothbardian_in_the_Cleve
  Posted on September 11, 2012 at 4:56pm
  That’s not how it works. The market prices in expectations in advance…it doesn’t react to them. The reason the market is up is because QE has been priced in already. If they announce it tomorrow the market will have a small bump. If they don’t? Watch it fall like a rock. Helicopter Ben HAS TO do it now. There is no way the fed can stop printing and they sure as heck have no facilities to unwind anything they’ve done recently. The market is now a QE junkie.
  
  Report this comment
soybomb315
Posted on September 11, 2012 at 4:10pm
If the federal reserve manipulates the economy long enough to ensure an Obama win – will you finally be ready to abolish the Fed?

Report this comment
Log in to Reply Reply
Popp40
Posted on September 11, 2012 at 4:09pm
So has anyone else heard about Moody is about to downgrade our credti again? Don’t you just love how they are running this country. They are doing all they can to act like they care and that they are trying to save America but the writing is on the wall….our “elected politicians” and the Fed want to destroy us.

Report this comment
Log in to ReplyReply
- ChiefGeorge
  Posted on September 11, 2012 at 4:35pm
  Right!@
  
  They pay lip service as our protectors of jobs and getting people back to work. We’ve been talking about saving American jobs since they started going overseas in the 70s and never once did this let up. America trudged forward creating other industries but is no longer a manufacturer like it used to be. We don’t even make TV’s anymore and we invented them. Anyways off topic slightly! These folks don’t want this country to be successful, they’ve got their gold, silver and diamonds stashed away so they will be fine, they want a total restructuring of our monetary system and this is what is the dangerous part because we are a debtor nation and when we restructure, the people we owe lose big time…problem is they are people like China who might even go to War to get their due. Don’t cross it out! Dear leader went to the fareast G20 meeting in late 09 or 10 and was warned not to do QE2 but we went ahead anyways. Dear Leader visited India first and remember the 34 ship floatilla nearby? Then a missile pops up off our west coast? America is in the cross hairs of our enemies for these actions. QE3 I believe will bring fire down on our heads. Only time will tell and when and if that happens, we’ll be saying this should not be happening.
  
  Report this comment
- term limits for congress
  Posted on September 11, 2012 at 5:46pm
  I am sure that the Federal Reserve recognizes that the only way out of our current situation is a devalued currency and massive inflation. Our creditors, however, want to be paid in 2006 dollars, not the new dollars. Not only will US citizens suffer, people all over the globe are going to suffer – and, they may not like being forced to suffer. Let’s vote out the Federal Reserve! uh oh
  
  Report this comment
- drs1969
  Posted on September 11, 2012 at 7:36pm
  George is right. No one likes being ripped off.
  
  Report this comment
colt1860
Posted on September 11, 2012 at 4:05pm
If you haven’t read or seen this, it’s time you do:

The Creature from Jekyll Island, by G. Edward Griffin
http://search.barnesandnoble.com/Creature-From-Jekyll-Island/G-Edward-Griffin/e/9780912986456

The Money Masters
http://www.youtube.com/watch?v=HfpO-WBz_mw

Report this comment
Log in to ReplyReply
- smokeysmoke
  Posted on September 11, 2012 at 4:15pm
  with an increase in the money supply come a devalueing of the US dollar….. A DEVALUING DOLLAR+ the INCOME TAX CODE= a system where the standard of living has not increased since WW2… as we devalue the dollar employers need charge more for their goods to make the same profit on their products… AT THE SAME TIME, the salaries of employees, STAYS THE SAME, BUT IN REALITY DEVALUED DOLLARS PURCHESES FEWER GOODS… so to maintain the publics standard of living EMPLOYERS ARE FORCED TO PAY MORE, so people can live on a larger sum of devalued dollars…. and employers then naturally going to charge more for their goods… ALL OF THESE THINGS ARE DECREASING THE STANDARD OF LIVING OF THE PUBLIC, BY ACTING AS HIDDEN TAXES AND DEVALUING PEOPLES PAY AND INCREASING THE PRICE OF GOODS… NOW TAKE INTO ACCOUNT OF THE INCOME TAX CODE… where people like GE pay an effective tax rate of 7% or the high income earners who use loopholes to bring down their tax rates… WHAT DOES THE GOVERNEMTN DO WITH THE MONEY IT HAS PRINTED AND SPENT…. they are taking money that could be used productivly by society, and are using it for their own nonproductive spending(productive spending= products goods and services that are needed to survive, agra, mining, construction, transportation)… obama says he is building roads, but the infrastructure is not better than 4 eyars ago… AND THE STANDARD OF LIVING HAS DECREASED..
  
  Report this comment
- smokeysmoke
  Posted on September 11, 2012 at 4:21pm
  the printing of capital IS A TAX ON THE MIDDLE CLASS… BY MAKING YOUR DOLLAR NOT GO AS FAR… NOT BUY AS MUCH…. WE ALL FEEL THIS… WE HAVE ALL SEEN IT HAPPENING FOR 20 YEARS… TELL THE PEOPLE THAT ITS SPEEDING UP… AND WHY… OBAMA IS CONTINUING THE SAME POLICIES THAT GOT US INTO THIS SITUATION
  
  Report this comment
watersRpeople
Posted on September 11, 2012 at 4:02pm
Satan stood up in Woodrow Wilson, FDR, LBJ, and Nixon causing them to number the children of the U.S. Now the Lord God is has stood up in Bush, Obama to cause them to number the children of America. That’s why they won’t stop printing.

Report this comment
Log in to Reply Reply
True American66
Posted on September 11, 2012 at 3:58pm
If you thought your grocery bills were higher last week, just wait ’till the FED devalues your dollar this time…..if you weren’t getting prepared before, you’d better get to the store tonight!

Report this comment
Log in to Reply Reply
fidel1234
Posted on September 11, 2012 at 3:56pm
There goes some more value of our fiat money,hyperinflation on the way soon.

Report this comment
Log in to Reply Reply
moreteaplease
Posted on September 11, 2012 at 3:53pm
What is the definition of “insanity” again?

Report this comment
Log in to Reply Reply
MODEL82A1
Posted on September 11, 2012 at 3:49pm
If you expect a QE3 announcement tomorrow, you are WRONG. If QE3 were imminent, the stock market would be skyrocketing today. It is not.

Report this comment
Log in to ReplyReply
- girlnurse
  Posted on September 11, 2012 at 4:04pm
  who do we trust or believe any more? I know my dad has been getting very good money on his stock portfolio. I don’t understand it all…but it seems to be artificially propped up somehow and will crash eventually. If not are we being lied to? Someone please explain…I am not an economics expert.
  
  Report this comment
- Popp40
  Posted on September 11, 2012 at 4:06pm
  I hope you are right Model82A1 because we cannot afford another QE, the inflation is going to kill us.
  
  Report this comment
- SCREW-WINDOWS
  Posted on September 11, 2012 at 4:09pm
  The demand for ink is not clear yet give it a day or two.
  
  Report this comment
- soybomb315
  Posted on September 11, 2012 at 4:21pm
  Maybe the market is not going up because someone burped in India. Let’s see what tomorrow holds
  
  Report this comment
- ChiefGeorge
  Posted on September 11, 2012 at 4:40pm
  With the EU having trouble with their debtors nations, the safest bet for investing big money is the US stock market, so this is why it is swinging higher everyday. These are the last of the suckers who they didn’t get in 2008. When the plug gets pulled sometime before the year is out, then you’ll really see chaos in the streets. Did you know that the Spainards pulled 76bil of their personal savings out of Spanish banks last month? Yea! They are scared and want to pull out of their home nations and many are moving out of their countries to aviod the collapse. This will be a worldwide event, many or most will not be safe.
  
  Report this comment
- PatriotofPast
  Posted on September 12, 2012 at 10:51am
  GirlNurse…By printing more BOGUS BUCKS, and using it to purchase OUR OWN DEBT…Only prolongs the Inevitable “A Total CRASH of our Currency. When we Left the “Gold Standard” and went Entirely to THE FEDERAL RESERVE NOTE,we went from something REAL (Gold), to basically an IOU!!! What scares the Hell out of me isThe GOVT. has been using FEDERAL LANDS as Collateral to Borrow from China!!! They were passing off WORTHLESS BONDS to China, and NOW, They want to be REPAID.
  
  Report this comment
Rothbardian_in_the_Cleve
Posted on September 11, 2012 at 3:44pm
Joe’s premise that people leaving the workforce is a precipice to demand pull inflation is laughable. Inflation is coming, but it is cost push driven by monetization impact on commodities. Good grief, he go to the Krugman school of economics?

The Fed is now stuck in QE infinity. They can’t unwind anything they put on the balance sheets. This is actually QE4 because twist didn’t work. They had been doing twist for some time. That is they buy the short end of the curve and sell the long. However, there isn’t sufficient supply of the latter to cover the former and they essentially began monetizing those purchases and expanding the balance sheet. So now they are out of bullets there they are going to go back to full on printing. Only problem is that the market has fully priced the action already and there is no “pop” left in doing so…only status quo. There are no more wins in printing only risks in not doing so.

YAY FED!!!!

Report this comment
Log in to Reply Reply
progressiveslayer
Posted on September 11, 2012 at 3:35pm
We purge DC of all communists,socialists and anarchists and return to the gold standard and we might recover,anything short of that and you can look forward to some tough times.

http://video.foxbusiness.com/v/1400682003001/the-benefits-of-a-return-to-the-gold-standard/

Report this comment
Log in to ReplyReply
- girlnurse
  Posted on September 11, 2012 at 3:39pm
  And start by slashing state and federal governments in half and get rid of the unions! Tax the heck out of any corporation that ships jobs overseas. Give tax breaks to those who employ lots of americans
  
  Report this comment
- progressiveslayer
  Posted on September 11, 2012 at 3:45pm
  Here here
  
  Report this comment
- progressiveslayer
  Posted on September 11, 2012 at 3:50pm
  I was hasty in my reply,if we lower the tax rate on corporations,we currently have the highest corporate tax rate they will keep jobs here.Also ending all unions and all yes all regulations will keep jobs here as well.Congress has no authority to regulate any business,we’ve been lied to for years about this authority to regulate businesses.
  
  Report this comment
- girlnurse
  Posted on September 11, 2012 at 3:58pm
  It doesn’t matter to me how it’s done. I will sum it up like this:
  Put a healthy FREE America and Americans first!
  
  Report this comment
- usedCZARsalesman
  Posted on September 11, 2012 at 4:13pm
  Do both GIRL…LOW corporate taxes here with penalties for those that ship overseas.
  
  Report this comment
girlnurse
Posted on September 11, 2012 at 3:31pm
IRS gives 100 MILLION to a whistleblower!
Here comes the gustapo!
http://www.washingtontimes.com/blog/inside-politics/2012/sep/11/irs-pays-104-million-whistleblower/

Report this comment
Log in to Reply Reply
The-Monk
Posted on September 11, 2012 at 3:31pm
Replace Ben with Dr. Paul…..

http://www.youtube.com/watch?v=Sy0UYLqRkRs

Report this comment
Log in to ReplyReply
- resme
  Posted on September 11, 2012 at 5:21pm
  Monk, From what I’ve read. The president is only allowed to choose from pre-selected nominees, chosen and agreed upon by the fed board.
  
  Report this comment
- WindyDualism
  Posted on September 11, 2012 at 5:21pm
  Solid thought.
  
  Report this comment
progressiveslayer
Posted on September 11, 2012 at 3:30pm
Uncle Ben will print more funny money that’s for damn sure,he should also be charged with perjury for lying under oath that he wouldn’t monetize the debt. I just hope the fed ceases to exist when the SHTF and we can get back to the gold standard where we belong.

Report this comment
Log in to Reply Reply
zach
Posted on September 11, 2012 at 3:25pm
How far down the road do they think they can kick this can before it bounces off the stop sign at the “end of the road”???????? I realize that nobody wants the crash to happen “on their watch”, but it’s going to happen, so let’s get it behind us. Delay will only make it worse.

Report this comment
Log in to ReplyReply
- TexasCommonSense
  Posted on September 11, 2012 at 3:35pm
  Can you say Weimar Republic? I knew you could. Stock up on beans, bullets and band-aids, kids.
  
  Report this comment
doomytram
Posted on September 11, 2012 at 3:25pm
When there was no more crawdads they ate sand. When there was no more sand they ate dollars. You ate what?

Report this comment
Log in to Reply Reply
IMCHRISTIAN
Posted on September 11, 2012 at 3:24pm
Heaven help us if they do as our dollar is worth about half anyway. They are so stupid they just would never listen to those that know economics. They would just want us, our children and grandchildren all to suffer.

Report this comment
Log in to Reply Reply
thibx
Posted on September 11, 2012 at 3:23pm
boehner needs to stop crying and do something.

Report this comment
Log in to ReplyReply
- doomytram
  Posted on September 11, 2012 at 3:31pm
  Ok, so how is Boehner going to get around Harry Reid and Barrack Obozo? This isn’t that hard to figure out THIBX is it?
  
  Report this comment
wlburge
Posted on September 11, 2012 at 3:23pm
So when will I be getting my check? (hardy-har-har!)

Report this comment
Log in to Reply Reply
thibx
Posted on September 11, 2012 at 3:21pm
rick perry got it right treason. fed. chairman and oboma need to be hung on the lawn of the white house.

Report this comment
Log in to ReplyReply
- nurseheidi
  Posted on September 11, 2012 at 11:24pm
  Amen to that!
  
  Report this comment
U.N.hater
Posted on September 11, 2012 at 3:21pm
Print as much as you can Mr. fed. The sooner we fall the sooner us real american men can rebuild this country back to the way’s of the constitution. When this does happen anyone who’s say’s we owe them. Tell them to kiss our AMERICAN A$$!

Report this comment
Log in to ReplyReply
- nurseheidi
  Posted on September 11, 2012 at 3:28pm
  Like your Spirit, Glad to know we still have REAL MEN left:)
  
  Report this comment
- fidel1234
  Posted on September 11, 2012 at 4:01pm
  Love it man,love it.
  
  Report this comment
- TexasCommonSense
  Posted on September 11, 2012 at 4:11pm
  I’m with ya, but we will likely have to fight the Commies first. They’re itching to take over. Apparently they are too dumb to learn from history.
  
  Report this comment
nurseheidi
Posted on September 11, 2012 at 3:20pm
Bernanke should be arrested for lying under oath to Congress! My God America stand up and shout. we are being robbed.

Report this comment
Log in to ReplyReply
- U.N.hater
  Posted on September 11, 2012 at 3:38pm
  I shout everyday but never get a response. I never hear anyone else yell’ing. I stand up every chance i get and people just look and stare. I guess i’m the only one who has their n uts still in their sack. Let me know when everyone esle find’s their’s again maybe we could team up watch each other’s back’s.
  
  Report this comment
- nurseheidi
  Posted on September 11, 2012 at 11:26pm
  I know you do, I read your posts. Gotta get with the girils, we seem to be the one’s with a set these days…with exceptions of course:)
  
  Report this comment
cubber
Posted on September 11, 2012 at 3:15pm
Be Prepared

Report this comment
Log in to ReplyReply
- SCREW-WINDOWS
  Posted on September 11, 2012 at 4:18pm
  Yes invest in ink and plastic.
  
  Report this comment

It appears that you have Javascript Disabled. Please enable Javascript in your browser preferences for a better user experience on TheBlaze. You can not comment without Javascript enabled.