I am nervous that QE3 might be in the works for September because PIMCO keeps trying to push it as a done deal already.
From tidbits I've read on internet or seen on tv, this only coarsely informed layman doesn't see QE3 as necessary right now (wait and see if the nascent upturn in U. S. economy John Chambers describes below is a sustained trend or not). But don't know if Bernanke sees potential weakness 6, 9, 12 months down the road that he feels he must stomp out now, or if he had to enter into some Faustian deal with Germans that he would ease now if Germans let ECB do some quantitive easing now to stabilize Eurozone for a while longer (i. e. actual follow-through on Draghi's forceful statements a while ago that he will do whatever it takes, even if Germans object).
Hoping they just focus on more quantitatively defining what would pull them in (e. g. less than 2% real gdp growth (not sure what type of nominal gdp targets might also be in play
http://www.economonitor.com/dolanec...in-nominal-gdp-growth-adds-to-pressure-on-fed, unemployment rate not declining on slow glide path over time), say nothing more than extending language to 2015, and primarily just trying to keep those who want to crash market from trying to push their bets too hard because Bernanke and Draghi will come in and spank them real hard if they try.
John Chambers of Cisco said on NBR recently (
http://www.nbr.com/videos/video/178...ers-company-earnings-aug-15-2012#.UD425I5k0QI) that companies he talks with are all planning around 1.5 - 2% gdp growth, and that he sees evidence of nascent upturn in U. S. economy but wants another quarter of data before declaring a trend.
Some JP Morgan CIO type was on tv a while ago and also was working with 1.5 - 2 % gdp growth assumption, but also felt like he was leaning to 2%.
And this morning Kevin Cronus on CNBC announced second quarter gdp revision (
http://video.cnbc.com/gallery/?video=3000112536&play=10), but was disappointed and seemed to indicate other traders were also disappointed because he was hoping for 1.9% revision. Seemed to indicate he felt current trend is around 2% now.
And FWIW, here is a QE3 odds calculator I saw on ZH:
http://www.zerohedge.com/news/definitive-qe3-odds-calculator
http://www.zerohedge.com/news/are-many-fomc-members-looking-same-economy
(to me, two payrolls well under 50K, if they are felt to actually reflect real deterioration of underlying economy, would pull in Fed right away, even before election. Hopefully, however, barring Romney's billionaire donors trying to crash market to pull economy down temporarily with it, Fed can hold off at least till after election and hold final bullet for fiscal cliff battle with the wing-nut lame duck Congress)
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