SF Fed President Williams:

  • No doubt US economy ‘on the mend’ but not strong enough to bring down unemployment
  • Credit conditions much improved
  • Without recent Fed action unemployment would make only modest gains, inflation would be stuck below 2%
  • Expects unemployment to decline to 7.5% by end of 2014
  • ‘Far from certain’ Europe to achieve complete fix

Nothing out of the ordinary here but sounds like he’s ready for 1-2 years of MBS buys under QE3.