Tags: Faber | Bernanke | shirked | ease

Faber: Bernanke Has Shirked Obligations, Will Ease Again

By    |   Wednesday, 11 April 2012 12:53 PM

Federal Reserve Chairman Ben Bernanke has failed his duty to protect the nation’s currency and will ultimately ease monetary policy further, says Marc Faber, publisher of The Gloom, Boom & Doom Report.

"If you're the head of a central bank, the number one priority is to safeguard the integrity of money, so that money continues to be the unit of account, the store of value, and means of exchange,” he tells Yahoo.

“I don’t think Mr. Bernanke has fulfilled these obligations."

Editor's Note: Study: Bernanke Intentionally Devalued the Dollar

At some point, he will implement additional quantitative easing (QE3) in an attempt to buoy the economy and financial markets, Faber says.

"If I were in his shoes, I would wait for the markets to sell off to get some sympathy for implementing QE3.”

With the Standard & Poor’s 500 Index trading near 1,400, it’s politically difficult to launch another round of easing now, especially given the recent increase in oil prices, Faber says.

Despite the Fed’s easing, money and bond markets will push interest rates higher before late 2014, the date until the Fed says it plans to keep interest rates near record lows.

Not everyone expects more Fed easing.

"Rather than tweaking the balance sheet in April, the FOMC statement is more likely to reinforce the message conveyed in January: rates are likely to stay on hold at least through late 2014," Bank of America strategist Ralph Axel wrote in a report obtained by CNBC.

Editor's Note: Study: Bernanke Intentionally Devalued the Dollar

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