QE3 Tomorrow? One Reason No One Talks About

So the FED is meeting today and tomorrow.

The economists and every pundit on Wall Street have an opinion on whether they will inject more money into the system through a third round of Quantitative Easing.

There are plenty of reasons for and against and you can read all the economic and fiscal reasons on other sites.

My take is that there will be more QE tomorrow and it is for a reason I have not seen anyone else mention.

Because Ben Bernanke is a human being. Some of you conservatives might argue that point, but stick with me.

Everyone knows there is an election coming and a strong stock market will help the incumbent. The election is also turning out to be a close race so far.

Bernanke has the ability to give the stock market one more push higher before the election. But he is supposed to remain impartial. So why I do I say he will do it?

Because Romney made it perfectly clear that he would fire Ben if he wins the election.

The FED has made it clear that it is not a matter of “if” they will do QE3 but “when”. And if “when” is the question, then the next opportunity after tomorrow is in December, after the election.

To me, Ben seems like a very smart man and one that is very sure of himself. So I don’t think he will care much if he gets replaced because of politics. But I have a feeling that he wants to stick around and see this thing through. If he stays, and the economy recovers he will be hailed as the best FED chief ever, and people will forget all about Ben’s predecessor Alan Greenspan or at least continue to blaim him for the whole mess. On top of that, Ben would get to stick it to Romney.

So what’s the downside? Not much if they are going to do it anyway. The upside? For Ben, a lot.

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  1. Bill Cantrell on September 12, 2012 at 12:26 pm

    Intelligent thinking.

  2. George on September 12, 2012 at 12:30 pm

    I sure hope so because more money printing means a weaker dollar and inflation. Commodities, especially gold and silver, will go up. Unfortunately more money printing only brings us closer to our demise.

  3. bill allman on September 12, 2012 at 12:38 pm

    Another advisory says “Our sources tell us Federal Reserve Chairman Bernanke wants President Obama ousted and as a result Bernanke is going to do nothing through the election unless the world starts to fall apart like it did in 2008.

    That being said we are looking for a reversal in gold and to play a down move next week. If the ball continues to bounce higher, then we will not play for such a move.

    • Genius on September 12, 2012 at 2:06 pm

      Why would be want that? So he could be put out of a job, the next guy could do some QE or something and get credit for getting us out of the malaise?

      If this advisory really had an inside source, that would be insider trading. They have already said they are ready to do it and will do it.
      Guess, we will see. 🙂

    • wannabe trader on September 14, 2012 at 10:04 am


  4. louis on September 12, 2012 at 12:42 pm


    I think you are right. That was my thought the very instant Romney made it clear Ben would be replaced.

    That said, it is a shame that Ben will follow his egocentric impulse and do something that will our
    country’s financial cliff that much harder to resolve.


  5. Dan on September 12, 2012 at 12:56 pm

    Do you think the market movers may work against this to drive the market down just before the election since the present administration hasn’t been too kind in their words about the high-rollers on Wall Street?

    • Genius on September 12, 2012 at 2:06 pm

      No way. They have no choice but to bid everything higher. More liquidity means a weaker dollar and more inflation.

      The bump in stock prices might not be as high as last time, but it will still push things higher. probably more slowly than last time.

  6. Mike on September 12, 2012 at 1:15 pm

    I agree with you and have held this opinion for a number of months.
    I do think that the FMOC can do QE3 between meetings!

    Mike G.

    • Genius on September 12, 2012 at 2:07 pm

      Hmm, true, very true. Hadn’t thought of that. 🙂

  7. jay on September 12, 2012 at 1:53 pm

    Sad but true. romney should have kept bison hands close to his vest.

    • Genius on September 12, 2012 at 2:07 pm

      I agree 100%.

  8. Blaze on September 12, 2012 at 2:39 pm

    What makes you think Dr. Bernanke wants the job? He hasn’t enjoyed having to pick up the slack for a failure of administration to find reasonable solutions to fiscal issues. Perhaps Dr. Bernanke knows that another 4 years of Obama will fail the USA, and being a student of the Great Depression, this current administration is not one he would enjoy working with for 4 more years. I say he wants Mitt Romney to save this country with discipline and creativity and is happy to walk away leaving him something to work with,,, and not another S&P downgrade which cannot be tolerated.

    • Genius on September 12, 2012 at 3:54 pm

      I think you are giving Romney too much credit.
      If Ben didn’t want the job, he would have resigned or never taken it when Obama offered it to him (when he was elected).

      If the credit rating does get another downgrade it will be because of the politicians in the House and Senate, not the FED or whoever is the President.

  9. Burt Shane on September 12, 2012 at 3:25 pm

    Just for this very reason it may not happen tomorrow – that Ben wants to keep his chair. Consider:

    1. Is Ben a law unto himslef – to do as he pleases when he wishes to? Or is he bound morally/regulated legally by certain rules?
    2. Are thing so bad (on paper, officially) as to justify QE3? If yes, how come the market is at an all time high? (Just sniffing paint instead of the real stuff!?)
    3. Is Romney so foolish as to make such a declaration (fire Ben) openly without considering likley consequeces and reactions? We all know that such an unequivioval declaration would raise hackles and would prompt a strong reaction from Ben – a reaction that likely would hinder his chances and firm up BO’s?
    4. Would not QE3 now cause alarm and accusations that BO is using underhand methods to improve his popularity and chances for re-election and cause a backlash?

    Even so, you could be right!
    The best!
    I think the game is deeper but you could be right!

  10. Blaze on September 12, 2012 at 7:27 pm

    Thank you, Burt. Well said. If Genius wants to look under the covers he should read Obama’s, Romney’s, and Bernanke’s resumes ,,, and and study their passions. Oh, and Genius, I am probably not giving Mitt Romney enough credit, even saying I believe he is probably the most qualified candidate for CEO of the USA in my lifetime, professionally speaking.

  11. Burt Shane on September 13, 2012 at 12:40 pm

    Hello folks!
    Ben has spoken.
    Is the the QE3 everybody was looking for/expecting?
    What are the implications?
    What next for the markets and gold/silver?

  12. Calamari on September 14, 2012 at 12:41 am

    wish I saw your post

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