CNBC's Steve Liesman's brains fell out of his head at the same time he lost his hair. - Dave in Denver
I hate to waive my own flag, but guys like Reggie Middleton and Tyler Durden pimp themselves so shamelessly and repetitively - and with brazen historical revisionism, especially Reggie - that I had to say something. The other day I suggested that the Fed might extend Operation Twist and shift the Treasuries it sells out to 3 years and the Treasuries it buys out to 30 years. The FOMC just announced the extension of Twist until the end of the year and it would sell Treasuries it holds out to 3 yrs and buy Treasuries from 6 to 30 years.
The Fed also said that it stands ready to use other methods to try and stimulate the economy if needed. It will be needed and it's just a matter of time.
By the way, Operation Twist, especially now that the duration of the Fed balance sheet will be significantly increased, is a de facto form of QE.
Just for the record, in follow-up to my commentary on housing yesterday, today's mortgage purchase application index from the Mortgage Banker's Assoc. was down 9%.