Paul Krugman Explains QE2

Economist Paul Krugman explaining QE2 Quantitative Easing 2 at Haverford College speaking event.
"...I was asked what's the FED is doing when it goes out and buys long term bonds , so what it is really doing is buying long term bonds and selling short term bonds , it is using bank reserves which are in effect short term claims on the US Government , or in some cases it is actually selling off it's holding on short term treasuries to buy long term bonds , meanwhile there is the treasury setting out there that is having a bunch of debt some of it long term debt , in effect the federal reserve is building up that short term debt and paying down some of the long term debt , so what's happening is QE2 is basically a reduction of the maturity of federal government debt and I think it works out as something like ten months of the maturity the average maturity of the federal government debt ...."

Mark Mobius on Impact of QE2

Nov. 25 2010 | Since the Fed's announcement of QE2, Mark Mobius, executive chairman of Templeton Emerging Markets Group, has noticed a tremendous amount of inflow into emerging market funds. CNBC's Jackie DeAngelis asks if he's worried about bubbles being formed.

The Dangers of QE2

Nov. 22 2010 | QE poses a danger of a bubble for emerging market countries, with Frederic Mishkin, former Federal Reserve Board governor.

Marc Faber Even 1 Trillion QE2 Will Not Save Stocks Nov 2010

Marc Faber recently in an interview with bloomberg said that  anything less than $1 trillion From Bernanke could disappoint investors and might prompt a correction in U.S. stocks. Marc Faber, managing director of Marc Faber Ltd publisher of the Gloom, Boom & Doom report, and Barron's Roundtable member, anticipates meaningful market correction in 2010. Mining and agriculture will be top performers within commodity sector.Marc Faber is currently recommending agriculture commodities, and the accumulation of precious metals although he does no roll out some correction before the end of the year before the prices shoot up in 2011

Joseph Stiglitz : QE2 will prove to be fairly ineffective

Nobel Prize winner and renowned economist Joseph Stiglitz has been very pessimistic about the global economy in the new afterword to his book Freefall.

QE2 Will Do More Harm Than Good

QE2 Will Do More Harm Than Good says Uwe Parpart

Nov. 7 2010 | The Fed's move to pump another $600 billion to prop up the economy is not going to work, says Uwe Parpart, chief economist & strategist, Asia at Cantor Fitzgerald. He tells CNBC's Bernard Lo, Oriel Morrison & Adam Bakhtiar why this move will backfire.

QE2 - a financial Titanic?

We look at quantitative easing in the US, Obama's visit to India and the G20 meeting in Seoul.

The Fed Magic Money-Printing Machine, Act 2

QE2,FED's try to jump start US economy or get Bankers rich and mission accomplished?

"What is “QE”? The first round of “quantitative easing” was a program announced by Ben Bernanke last March in response to the financial crisis, ending in March of this year. In what will soon be known as “QE1”(i.e. once QE2 is announced), Bernanke printed over a trillion dollars out of thin air, then used that money to buy, among other things, mortgage-backed securities (MBS) and Treasury Bonds. In other words, the government was printing money to a) lend to itself and b) prop up the housing market, with Wall Street stepping in to take a big cut. " Matt Taibbi on The Fed's Magic Money-Printing Machine, Act 2 http://www.rollingstone.com/politics/...

****** Quantitative easing *******

The term quantitative easing (QE) describes a monetary policy used by central banks to increase the supply of money by increasing the excess reserves of the banking system. This policy is usually invoked when the normal methods to control the money supply have failed, i.e the bank interest rate, discount rate and/or interbank interest rate are either at, or close to, zero.

A central bank implements QE by first crediting its own account with money it creates ex nihilo ("out of nothing").[1] It then purchases financial assets, including government bonds, agency debt, mortgage-backed securities and corporate bonds, from banks and other financial institutions in a process referred to as open market operations. The purchases, by way of account deposits, give banks the excess reserves required for them to create new money, and thus hopefully induce a stimulation of the economy, by the process of deposit multiplication from increased lending in the fractional reserve banking system.

Risks include the policy being more effective than intended, spurring hyperinflation, or the risk of not being effective enough, if banks opt simply to sit on the additional cash in order to increase their capital reserves in a climate of increasing defaults in their present loan portfolio.[1]

"Quantitative" refers to the fact that a specific quantity of money is being created; "easing" refers to reducing the pressure on banks.[2] However, another explanation is that the name comes from the Japanese-language expression for "stimulatory monetary policy", which uses the term "easing".[3] Quantitative easing is sometimes colloquially described as "printing money" although in reality the money is simply created by electronically adding a number to an account. Examples of economies where this policy has been used include Japan during the early 2000s, and the United States, the United Kingdom and the Eurozone during the global financial crisis of 2008--the present, since the programme is suitable for economies where the bank interest rate, discount rate and/or interbank interest rate are either at, or close to, zero.

Marc Faber : Even 1 Trillion QE2 Will Not Save Stocks

Marc Faber : ....I think QE2 will be interesting to watch , basically what we have is , back in July august investors were very bearish on the market and they talked about the The Hindenburg Omen and that everything would crash and so forth ...and what then happened is that September was very strong and October was reasonably good month as well , and the market has gone from a low on July first of 1010 on the S&P to close to 1200 , and so a lot of QE2 has been discounted and if you were mister Bernanke I suppose that you would probably disappoint investor somewhat with QE2 and watch once the market reaction , if the market really sell-off you can then increase QE2 or launch QE3 , and QE4 and QE5 and so forth , they'll be many more QEs ......etc....
Anything under a Trillion Dollars Will Dissapoint Market

Weak Dollar Strong Gold Silver Industrial Commodities

Correction then Boom in Stocks and Commodities

Reasonably Positive on Equites

Cash and Bonds Negative

China Economic Pullback Overheated
Real Cost of living 8-15%
Food 50% of living expenses

Marc Faber Market Sell Off On QE2 Announcement

Marc Faber : ....I think QE2 will be interesting to watch , basically what we have is , back in July august investors were very bearish on the market and they talked about the The Hindenburg Omen and that everything would crash and so forth ...and what then happened is that September was very strong and October was reasonably good month as well , and the market has gone from a low on July first of 1010 on the S&P to close to 1200 , and so a lot of QE2 has been discounted and if you were mister Bernanke I suppose that you would probably disappoint investor somewhat with QE2 and watch once the market reaction , if the market really sell-off you can then increase QE2 or launch QE3 , and QE4 and QE5 and so forth , they'll be many more QEs ......etc....

Oct. 26 (Bloomberg) -- Marc Faber, publisher of the Gloom, Boom & Doom report, discusses the potential impact of further quantitative easing by the Federal Reserve on stocks. Faber, speaking with Margaret Brennan on Bloomberg Television's "InBusiness," says more monetary easing could disappoint investors and may prompt a correction in U.S. stocks. (Source: Bloomberg)
Marc Faber, publisher of the Gloom, Boom & Doom report, discusses the potential impact of further quantitative easing by the Federal Reserve on stocks.

Marc Faber QE2 to Drive Down Stocks

Marc Faber on Bloomberg 10/26/10

Marc Faber, publisher of the Gloom, Boom & Doom report, discusses the potential impact of further quantitative easing by the Federal Reserve on stocks.



Marc Faber : ....I think QE2 will be interesting to watch , basically what we have is , back in July august investors were very bearish on the market and they talked about the The Hindenburg Omen and that everything would crash and so forth ...and what then happened is that September was very strong and October was reasonably good month as well , and the market has gone from a low on July first of 1010 on the S&P to close to 1200 , and so a lot of QE2 has been discounted and if you were mister Bernanke I suppose that you would probably disappoint investor somewhat with QE2 and watch once the market reaction , if the market really sell-off you can then increase QE2 or launch QE3 , and QE4 and QE5 and so forth , they'll be many more QEs ......etc....