Fed Leaning Closer to New Stimulus if No Growth Is Seen
New York Times, July 25, 2012
"The Fed’s chairman, Ben S. Bernanke, told Congress last week that the options under consideration included a new round of asset purchases, or “quantitative easing,” often described as QE3. As part of any such program, officials increasingly favor expanding the Fed’s holdings of mortgage-backed securities for the first time since 2010.
Mr. Bernanke and other Fed officials are convinced that such a step would further drive down long-term interest rates and improve the pace of economic growth, but they are concerned that the benefits would be modest and the costs uncertain."