Earnings season is now in focus but "taper talk" won't go away quietly. This Wednesday may bring more insight into the Fed and, investors hope, the taper timeline when FOMC minutes are released. Fed Chairman Ben Bernanke roiled financial markets last month when he announced the Fed may begin reducing asset purchases as early as this year and end them in 2014 if the economy continues to improve.
Stocks have since resumed their rally but Treasury rates haven’t retreated, and economists continue to debate the Fed’s next move.
Dean Baker, co-director of the Center for Economic and Policy Research, says he has “a hard time understanding... the rush to taper.”
He tells The Daily Ticker: “We’re down somewhere about 8.5 million jobs from trend… six percentage points below potential GDP, inflation is nowhere to be seen and if anything we probably want a higher inflation rate, as Bernanke has indicated himself. “Given allRead More »from Ignore Feldstein, Fed Should Taper in 2014: Dean Baker