Fed Result and Some Thoughts

So, as expected, the Fed meeting was a non-event in terms of initiating some form of QE3.

What was interesting was the shift in dissent as well as the inclusion of “significant downside risks” even as there was a mentioning of economic strength.  Overall yes, the economy did strengthen and the statement was updated to reflect this.  However, I believe that they still included the “significant downside risk” due to the Eurozone issues.  Keeping this language tells me that they will do QE3 should the situation in the region spiral out of control.  

If it gets resolved, then market strength (and therefore higher commodity prices) will probably keep the Fed at bay for a while (not sure how long)….unless Charlie Evans gets his way.  I wonder if he’s speaking for the other doves.

Targeting the unemployment rate or nominal GDP would be a grave long-term error in my view.  Evans is crazy, I’m ashamed he represents Chicago.