Goldman Sachs’ Jan Hatzius says QE2 is heading from $600 billion to $2 trillion and will continue through 2012 (via Zero Hedge).
He also believes the Fed may avoid any tightening measures until 2015. That means no interest rate hikes for half a decade.
This would be consistent with the Fed’s desire to provide consistent, long-term, accommodative policy while the U.S. consumer deleverages and the housing market stabilizes.
The potential impact on blowing asset bubbles in emerging markets and driving inflation there is obvious.