No QE3, Rate to Remain Low Until At Least Mid 2013

And the US stock market goes all over the place. Dow was -60, but a mere second ago it had been -90. Then it was -60, and now +58. I believe the order is out to the traders and algo bots: "Don't you dare let the market end up in red." Occasionally my stock screen that has companies in different industries lights up all at the same time in green, except for those inverse ETFs, which indicates to me that they are buying up the indices (or futures on it or options on the futures or options on double- and triple-long ETFs on indices...).

Three Fed FOMC members (Richard Fisher, president of the Dallas Fed, Charles Plosser of Philadelphia and Narayana Kocherlakota of the Minneapolis Fed) dissented, who wanted to keep the rate low for "an extended period" without mentioning the time frame.

From Bloomberg (8/9/2011):

The Federal Reserve pledged for the first time to keep its benchmark interest rate

at a record low at least through mid-2013 in a bid to revive the flagging recovery after a worldwide stock rout.

The Federal Open Market Committee discussed a range of policy tools to bolster the economy and said it is “prepared to employ these tools as appropriate,” it said in a statement today in Washington. Three members of the FOMC dissented, preferring to maintain the pledge to keep rates low for an “extended period.”

The decision represents the biggest effort since November to spark the U.S. economy and revive confidence while stopping short of initiating a third round of large-scale asset purchases. Chairman Ben S. Bernanke and his colleagues acted after reports showed the economy was slowing and an unprecedented downgrade to the U.S. credit rating sent stocks tumbling from Sydney to New York.

.....

The vote was 7-3. Richard Fisher, president of the Dallas Fed, Charles Plosser of Philadelphia and Narayana Kocherlakota of the Minneapolis Fed all dissented. It was the first time under Bernanke that three FOMC members dissented.

(The article continues.)

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