'Y' I'm 'Fairly' Sure 'Many' Fed Printing Presses Are Warming Up
"Many members" and "likely" and "fairly soon", one right after the other, a notable Fed speak grammatical triumvirate if there ever were one.
That sentence is this month's edition of the Fed Speak "Y" word game, and it pushed gold up by more than $15 in late trading on Wednesday to a four month high (notably, it was four months ago that the parsing of the FOMC minutes turned what had been a moderately bullish gold trade to a moderately dead one as QE3 was then judged a longshot, or at least to be long delayed if still coming).
If you ask me, 80% chance of QE3 -- if the economy doesn't show more sustained growth -- as the Fed spoke in the latest FOMC notes -- is a timid bet by bond guru Gross. One "Y" word can be a fairly strong indication from the Fed, at least, as far as the market and the press are concerned. Put two "Y" words in the one sentence and you've got the QE3 version of compound interest. Use three "Y" words and the Fed must think "Y" words grow on trees like free money.
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Which is "Y" I'm "fairly" sure "many" Fed printing presses are warming up right now and will "likely" print some more money. If not, the latest Fed speak could turn out to be fairly disappointing to many.
-- Written by Eric Rosenbaum from New York.
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