QE3 is over. So what will the market do in response? And if the market drops far enough, will the Fed step in with QE4 or QE4ever?
POMO Is Officially Dead… Until The Next QE
Courtesy of ZeroHedge
Back when QE1 ended in 2010, everyone celebrated the end of POMO, except for websites such as this one which warned it was only a matter of time before the Fed unleashes another QE program to offset the market correction. We were right.
Then, when QE2 ended, everyone celebrated the end of POMO, except for… well you get the picture.
Moments ago, the last POMO of QE3 just hit the tape when the NY Fed monetized $931 million of bonds matruing between 2036 and 2044, which was also the last ever POMO…. at least under QE3.
So feel free to rejoice, if only for a few months, but don't be surprised when the market dumps, and Bullard, Williams et al, follow through on their promise of launching Qe4 and POMO restarts all over again.
