Decision Economics talks about how the Fed could unveil something similar to the Bank of England’s funding for lending program.
It may be too soon; a new program takes some explaining. If you want to get it up and running by September, you probably need a (Fed) Board presentation at the next FOMC meeting at the very least – and then act on it in September.
This is fertile ground for discussion. The risk with QE3 is that it’s ineffective and then the Fed is viewed as helpless, which is a nightmare for Bernanke & Co. A new, creative program may give a larger boost to confidence and won’t risk the Fed’s mystique.
Bernanke begins two days of testimony tomorrow.
