He wants an open-ended commitment to buy bonds until the unemployment rate falls, even those two factors are only very loosely correlated.
A mid-sized program of bond buying, say a measly half-trillion or so, will disappoint the old man, while a move to only postpone the date of the first forecast rate hike will send the dollar soaring and risk assets plummeting.
What I would like to see most is for the Fed to disappoint the market with no QE today, a dive in EUR/USD and to see the reaction in the 1.2790/1.2815 area. If we get through there, we’ve probably topped for the near-term. If we don’t, I think the remaining shorts in EUR/USD will cover very quickly and we could test 1.30 in the next few days.
