St Louis Fedhead Bullard: We Should Just Keep Buying Up Stuff.
James Bullard has seriously gone out of his mind. He's gone, no use trying to reign him back in, he's drifting out there somewhere between monetary madness and lucid dreaming, pushing down the gas and trying to get us the hell out of here.
Federal Reserve Bank of St. Louis President James Bullard said the central bank should retain the flexibility to respond to any weakening in the economy by extending beyond March its authority to buy mortgage-backed securities and agency bonds.
“I would just like to keep them active at a very low level instead of saying we’re shutting down, shutting down permanently,” Bullard told reporters after a speech yesterday in New York. “Initially it would do nothing for the economy, but it would give the Fed the option to react to future news as it comes in.”
Policy makers reiterated Nov. 4 that they will complete the Fed’s planned $1.25 trillion in purchases of mortgage securities by March and said they will buy $175 billion of agency debt, down from a previous maximum of $200 billion. They kept the benchmark interest rate in a range of zero to 0.25 percent and repeated that rates will stay low for an “extended period.” The Fed has also purchased $300 billion of Treasury securities.
“If the economy came in very weak, let’s say, in 2010, weaker than expected, we would have the option of doing further quantitative easing” through additional asset purchases, Bullard said. “If the economy came in stronger than expected and inflation expectations started to ratchet up a little bit we could maybe sell off some of these assets and remove some of the accommodation from our quantitative easing program.”
The dollar fell to $1.4941 per euro as of 1:47 p.m. in Tokyo from $1.4862 in New York on Nov. 20.
The dollar appreciated during the financial crisis because investors view the currency as comparatively safe in times of turmoil, Bullard said during a panel discussion.
Currency is comparatively safe to what, air? Weed? Vodka? What? Is the dollar more stable than, say, weapons-grade Plutonium? I'm just looking for a point of reference here since I know the dollar and it is anything but "safe in times of turmoil" unless the turmoil is happening in Somalia and no one over here notices.
That moronic statement aside (he's probably still getting shit for those doomsday comments the other day, he's certainly still getting it from me), I'm getting the feeling Bullard should do the dollar a favor and go hide out for a little bit. Shhhh, there there, homie, everything will be ok, just don't open your mouth for awhile, sit there and be pretty.
St Louis, you've got a rogue agent on your hands and I'm not sure how you're going to handle this one. I especially like the "initially it would do nothing for the economy" confession - this guy is out of control, you guys better put a tranquilizer dart in his ass before he really spills important Temple secrets.
Bullard is voting on the FOMC next year so someone better get this taken care of before he starts doing other things that would "initially do nothing for the economy" and involve excessive monetization of debt just for kicks. Don't say I didn't try to warn you.