Investing
More & More Chances of Quantitative Easing, QE3 Dreams Live On
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With China’s growth slowing further and with Europe’s woes growing each day, economic data in the United States continues to ride the line closer to recessionary levels. Japan hit a 28-year low on its broader Topix index of shares today, and now they key DJIA in the U.S. went into negative territory for 2012 today and on Friday. It should probably be no surprise, but the calls for more quantitative easing measures are back on the rise. Here are some of the fresh issues to consider on the call for QE3:
At some point the U.S. and global economies are going to have to grow on their own without such strong support and infusion from governments. That point just does not appear to be ‘today.’ Maybe you could argue that this is an election year and that this will drive the chances higher for more easing measures. Either way, it seems that the markets are still hellbent on the notion that excessive government contribution has to be maintained to support the markets and the economy.
The question that remains to be answered in the U.S. is how the politicos and the Fed plan to deal with the fiscal cliff coming after the end of 2012 when government spending programs come at the same time as low tax rates expire. Regardless of the election outcome, that is an issue which remains unanswered.
As a reminder, the next recession is just the next recession rather than a double dip recession.
JON C. OGG
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