Saturday, June 22, 2013
Ben Bernanke - Calling early victory?
Market reaction to Fed announcement of reducing easy liquidity it has
splashed the markets with, has not come as a surprise to lot of
investors. It is the timing, which caught few investors off-guard. US
markets are not yet out of the rut, unemployment is still not back to
pre-crisis range, business confidence has not improved significantly
meaning none of the objectives of the QE has been achieved so far. Investors should keep in mind that Ben's term is getting over in
January, and maybe the biggest reason of tapering down of QE is that he
does not want to go down in history as the person who threw the world
economy into deflation. He does not want to end up like his predecessor
Alan Greenspan. Maybe that explains the call for early victory.
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