Recovery tests Fed's low-rate resolve

[Ardent15]

"WASHINGTON (Reuters) - U.S. consumers are buying more than just the basics and companies appear to be on the cusp of resuming hiring, which means the Federal Reserve has some thinking to do about its ultra-low interest rate pledge.

Economists widely expect the Fed, the U.S. central bank, to repeat its promise to keep borrowing costs exceptionally low for an "extended period" when it concludes its policy-setting meeting on Tuesday. The federal funds rate has been near zero since December 2008.

Investors interpret that phrase -- which the Fed has used in every statement announcing its monetary policy decisions since March 2009 -- as a signal that the first rate hike is still several months away, although there is no consensus among Fed officials about precisely how long an extended period is.

Regardless of the exact meaning, the phrase's days may be numbered as the economic recovery broadens and builds."

more...

http://in.reuters.com/article/economicNews/idINIndia-46910520100315

[DJ13]

1. There is still little recovery for the bottom 2/3rds of the populace

If they tighten to early they will throw the economy right back into a tailspin that the bottom income groups will never recover from.

Of course, that might be the goal.....

[Newsjock]

2. On what planet

... is the "economic recovery broadening and building"?

The most optimistic spin on the economic stats is merely that things are deteriorating at a slower rate. That's not a recovery. Then again, maybe the banksters are buying shiny new HDTVs and Escalades.

No recovery in this household.

[Ardent15]

3. It's been a while since the nation rose and fell together

Nowadays, one man's recovery is another man's depression.