Another QE is a bad idea for US
US Federal Reserve (Fed) President Ben Bernanke's speech in Jackson Hole, Wyoming, on Aug 31 has raised speculation that a third round of quantitative easing (QE3) is in the offing. Before the Fed takes a decision at its upcoming board meeting on Sept 12-13, the market doesn't know what turn to take. In the meanwhile, prices of precious metals and oil have risen.
The Fed claims the two rounds of QE have raised American GDP by 3 percent and created 2 million jobs. But many economists doubt the numbers.
The Fed carries two mandates: monetary stability and full employment. This often places it in a contradictory position, just like what is happening now. The US economy is growing at a moderate rate but robustly, not lower than its long-term average.
