- Federal Reserve officials considering new bond-buying program
- Federal Reserve would buy long-term mortgage or Treasury bonds but effectively tie up that money by borrowing it back for short periods at low rates
- Gold and silver spiking on the news
Silver has just vaulted .80 on the WSJ report from Jon Hilsenrath that the Fed is considering a new 'sterilized' QE. Apparently now that gold has been knocked down $150 from recent levels and silver by $5, the official QE3 rumors can again begin.
Gold is also up nearly $15 on the news.
Federal Reserve officials are considering a new type of bond-buying program designed to subdue worries about future inflation if they decide to take new steps to boost the economy in the months ahead.
Under the new approach, the Fed would print new money to buy long-term mortgage or Treasury bonds but effectively tie up that money by borrowing it back for short periods at low rates. The aim of such an approach would be to relieve anxieties that money printing could fuel inflation later, a fear widely expressed by critics of the Fed's previous efforts to aid the recovery.