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Fed Looking At More Than Just Buying Treasurys?

Most investors expect the Fed to implement more quantitative easing. Is most of the market right? CNBC's Steve Liesman asked Boston Fed president Eric Rosengren.
Although he was diplomatic in his language, and said “we’re going to have to discuss whether we do quantitative easing or not” reading between the lines it appears Rosengren believes that the Fed needs to be aggressive now.

Japan's experience with deflation suggests the country was too meek about easing monetary policy, and the United States should not repeat that mistake, he said.

"They also did quantitative easing, but they did it very gradually," he said. “We may not want to do it nearly as gradually."

But if you think that means the Fed is just buying Treasurys, think again.

Rosengren says “we’re more interested in long-term instruments like mortgage backed securities and corporate bonds.”

Ultimately all of this is to prevent further disinflation from occurring. "Part of the problem we're trying to address is the inflation rate is lower than we'd like," he added.

This is a conversation that no investor should miss. Watch the video for all the details.


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