Medley says: forget about QE3 from Bernanke. Richard Medley, head of RHM Global and a strategist who publishes influential intelligence reports, was on our air with me a short time ago.
He says Mr. Bernanke won't make any new policy pronouncements because he simply will not have the support from the rest of the 11-member FOMC.
There were three dissents just on saying they will keep rates low until 2013. Medley thinks if Bernanke tries to push through a third round of quantitative easing (QE3) he may have as many as five dissents — that is effectively a veto, Medley says.
On Europe, Medley told me in a phone interview that German Chancellor Angela Merkel is being pushed into going along with an accelerated fiscal union by none other than her mentor, Helmut Kohl. Merkel is Kohl's hand-picked successor and Kohl is clearly worried that his legacy of a united Europe is being threatened by her intransigence.
Her intransigence is rooted not just in ideology but in politics: her main coalition partner does not support any of the bailout plans, so she is in a very difficult position.
How serious are the political problems with the bailouts in Germany? Germany is considering postponing a vote on expanding the European Financial Stability Facility (EFSF) because — get this — the Pope was coming.
The vote, originally scheduled for September 23 but which may be set instead for September 29, is running into big political problems and politicians apparently want more time to work out an agreement on the separate Greek bailout issue.
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