Global investors say Federal Reserve Chairman Ben S. Bernanke’s bond-swap program, known as Operation Twist, will fail to reduce unemployment as the world’s largest economy slows.
Seventy-eight percent of respondents say the Fed’s plan to replace $400 billion of short-term debt with longer-term Treasuries won’t create jobs for the nation’s 14 million unemployed, according to the quarterly Bloomberg Global Poll of 1,031 investors, analysts and traders who are Bloomberg subscribers.
“There’s probably nothing monetary policy can do except keep the psychology of the market positive,” poll respondent Jonathan Sadowsky, chief investment officer of Vaca Creek Asset Management in San Francisco, said in a follow-up interview. “The Fed is actually trying something while the politicians are doing nothing except squabbling.”
Investors are evenly divided on whether Operation Twist is a good idea or a bad one, and Bernanke remains very popular among them, more so than other American figures such as President Barack Obama and Treasury Secretary Timothy F. Geithner.
The central bank, announcing the move last week, said it was designed to “support a stronger economic recovery,” and it cited “significant downside risks” to the outlook. The decision provoked three dissents for the second straight meeting, posing the most opposition within Federal Open Market Committee in almost 19 years.
Sixty percent of respondents see the U.S. economy deteriorating, and 50 percent said it will relapse into recession in the next year. Nineteen percent expect another financial meltdown in that period. Over the next two to five years, an additional 26 percent expect a crisis.
http://www.bloomberg.com/news/2011-09-30/fed-operation-twist-fails-to-reduce-unemployment-in-global-poll.html
Seventy-eight percent of respondents say the Fed’s plan to replace $400 billion of short-term debt with longer-term Treasuries won’t create jobs for the nation’s 14 million unemployed, according to the quarterly Bloomberg Global Poll of 1,031 investors, analysts and traders who are Bloomberg subscribers.
“There’s probably nothing monetary policy can do except keep the psychology of the market positive,” poll respondent Jonathan Sadowsky, chief investment officer of Vaca Creek Asset Management in San Francisco, said in a follow-up interview. “The Fed is actually trying something while the politicians are doing nothing except squabbling.”
Investors are evenly divided on whether Operation Twist is a good idea or a bad one, and Bernanke remains very popular among them, more so than other American figures such as President Barack Obama and Treasury Secretary Timothy F. Geithner.
The central bank, announcing the move last week, said it was designed to “support a stronger economic recovery,” and it cited “significant downside risks” to the outlook. The decision provoked three dissents for the second straight meeting, posing the most opposition within Federal Open Market Committee in almost 19 years.
Sixty percent of respondents see the U.S. economy deteriorating, and 50 percent said it will relapse into recession in the next year. Nineteen percent expect another financial meltdown in that period. Over the next two to five years, an additional 26 percent expect a crisis.
http://www.bloomberg.com/news/2011-09-30/fed-operation-twist-fails-to-reduce-unemployment-in-global-poll.html
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