Here’s your first real glimpse at what the Fed has planned for its November meeting.
(This month the FOMC announced that it was opening the door to more QE, and that caused stocks to surge.)
Anyway, WSJ’s Jon Hilsenrath, who has been the top reporter on the FOMC lately has the early read.
Rather than announcing massive bond purchases with a finite end, as they did in 2009 to shock the U.S. financial system back to life, Fed officials are weighing a more open-ended, smaller-scale program that they could adjust as the recovery unfolds.
What would be most worrisome is if this approach is the result of a compromise, and it sounds like that might be what we get:
A small-scale approach could be a path to compromise among officials. “Given the disagreement about the need for additional easing within the FOMC, retaining some flexibility might be critical to the adoption” of more quantitative easing, Goldman Sachs analysts said recently.