QE4...QE forever? The FOMC statement, and Ben Bernanke in his presser, made it clear: they will keep going until things get better.
He declined to give a target for employment, but this says it all: "If the outlook for the labor market does not improve substantially, the Committee will continue its purchases of agency mortgage-backed securities, undertake additional asset purchases, and employ its other policy tools as appropriate until such improvement is achieved in a context of price stability."
Substantially. That's a big hurdle to overcome. QE will be with us for some time. And it can change. Get bigger, or smaller.
Does QE make any difference? Does it improve the economy? Bernanke said it will not solve the economic problem by itself but has enough force to nudge the economy in the right direction.
Will higher asset prices help the economy? Bernanke says that if someone's personal financial situation is better (homes, stocks) people will spend more.
But don't low rates hurt savers? Bernanke admitted it did, but said healthy investment returns cannot be sustained in a weak economy. He insisted Americans will benefit from the low interest rates.
—By CNBC’s Bob Pisani
Bookmark CNBC Data Pages:
Want updates whenever a Trader Talk blog is filed? Follow me on Twitter: twitter.com/BobPisani.
Questions? Comments? email@example.com