Debate Within Fed

The March FOMC meeting minutes were released early today which showed active debate among Fed officials on the fate of $85 billion monthly bond purchasing program. Here is a report from the Wall Street Journal.

The minutes, which were released early Wednesday rather than in the afternoon as usual, showed that "all but a few" Fed officials agreed at the central bank's last policy meeting that they wanted to keep the program going "at least through midyear." But after that, officials had a wide range of views about how they might proceed.

Some at the March meeting felt the Fed would be able to begin tapering the program down around midyear. Others saw the Fed continuing through September before tapering down, and a few wanted to keep the program going at its current pace through 2013 and into 2014. Some also held out the possibility of increasing the program if the economic outlook deteriorates.

As the meeting was held on March 19 and 20, data released after the meeting have generally showed that economic conditions have mostly softened. Thus, strengthening the argument for those who want to extend and even expand the quantitative easing program. That is of course why the stock market is once again reaching new heights and the Fed minutes were all but ignored.

Onto the Fed wagon, stocks have hitched a ride. In Fed we trust that where ever the wagon goes, there shall be no roads that the Fed can't not navigate. Amen!