Stocks are off this morning on news that China's economy is slowing and U.S. import costs are rising... The thing is, China is actively tightening its purse strings to ward off inflation... I.e., they, unlike us, are not ignoring the latter...
Ben Bernanke not offering up any hints of QE3 in last Tuesday's chat with the world banking community sparked a 90 point sell-off in the Dow... I think he'd love to do QE3... I think short-sighted Wall Street would love it as well... Printing more money however is politically untenable at the moment...
Two weeks ago, when Germany backed away from plans to force a Greek near-term debt restructuring, a triple-digit rally ensued... A restructuring would levy huge losses onto Greece's creditors... Ultimately however, I suspect there's no alternative... Germany, in effect, just kicked the can down the road...
Over the past year U.S. consumers have been paying down debt and growing their savings... That's not good in (near-term) economic-recovery terms... Now wouldn't you think, given the debt-induced hell the world just endured, that any semblance of long-term prudence would be welcome? You might, but yours and my perception of long-term, say 10 years, differs vastly from that of your everyday Wall Street trader, say 10 seconds...
In a recent column I suggested that
Marty, QE3 will be stealth in that it will n;ot be announced, rather implemented by rolling over the existing balance sheet, rather that retirement for the prior issues. The current players will not allow the purging that is so needed until after 2012. great overview, somethings never change, until there are no other choices.
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