The U.S. economy has strengthened, but not enough for the government to pare down its bond-buying program, according to the latest Fed minutes. In late 2010, investments rose and the job market improved -- but the housing market remained depressed.
Republican leaders may be worried about the Federal Reserve's second round of quantitative easing, but the stock and credit markets are delighted: They've improved significantly since the plan was announced. But can the rally be solely attributed to QE2?
The Federal Reserve on Thursday proposed a new rule that would dramatically cut the swipe fees that banks charge merchants when customers use debit cards. The move, which stems from a provision in the financial overhaul bill in July, could benefit stores. But banks say it could harm consumers.
New rules proposed by the Fed for debit card transactions may mean consumers end up paying more to use their cards, while big retailers save billions. The rules would sharply limit the transaction fees sellers pay, so banks could recoup that money from buyers.
For the 22nd-straight month, the central bank kept its target interest rate at 0% to 0.25%. It made no new asset purchases and no changes to QE2, its $600 billion, eight-month bond-buying program. Housing and hiring are two main areas of concern in a slow-growth economy.
Traders face plenty of economic news this week, and considering how much the market has risen, it could be time for a bit of a pullback. But at least one trader thinks that's just what's needed to create a base for further gains ahead. [Video]
U.S. household wealth increased 2.2% in the third quarter as stock prices rose and consumers cut debt, according to a Federal Reserve report released Thursday. Companies' cash balances also grew in the third quarter.
Silver prices touched a 30-year high Monday as investors sought the safety of precious metals. Inflation concerns are running high after Fed Chairman Ben Bernanke said the central bank is considering a third round of qualitative easing.
Bank of America has told U.S. regulators that it has met the final condition that was set on its plan to exit the government's Troubled Asset Relief Program. BofA, which repaid $45 billion in TARP funds in December 2009, needed to raise $3 billion in capital by the end of 2010.
The Fed%u2019s latest Beige Book report finds that economic growth has increased but also that the economy is still growing well below its potential and too slowly to substantially lower unemployment.
The central bank says the disclosures cover more than 21,000 individual transactions done to "restore the flow of credit to American families and businesses, and support economic recovery and job creation in the aftermath of the crisis." It also says no money has been lost so far.
The Fed says it expects the U.S. economy to grow weakly in both 2010 and 2011, with as many as six years needed to return unemployment to normal levels.
This week, the Congressional Oversight Panel recommended that the nation's big banks be stress tested again, because if problems with mortgage-backed securities are widespread, the consequences could be dire. Now, the Fed has agreed to run those tests, which it wouldn't do if it wasn't worried.
The Federal Reserve has set a Jan. 7 deadline for the largest banks to prove they have the capital to withstand another financial crisis. Bank of America, JPMorgan Chase, Citibank and 16 others will have to file so-called "stress test" documentation by then.
When QE2 is complete, the Fed's bond purchases will have injected $1.7 trillion in liquidity into the markets since 2008 in an effort to boost corporate investment in new production and new jobs in the U.S. Instead, companies are taking cash raised here and investing it in emerging markets.
Some of the best reads for investors from around the Web, including posts evaluating how consumers spend their money, whether Google could be considered a monopoly and the debate about the Fed's policy on quantitative easing.
The more lenient lending policies enacted by the Federal Reserve last month have so far failed to increase demand from small businesses, indicating that the federal government's attempts to spur the U.S. economy through more aggressive monetary policy may need more time to take effect.
U.S. Federal Reserve launched the second phase of its quantitative easing program, the so-called QE2, saying it will buy up to $600 billion more in long-term U.S. Treasury bonds to help stimulate a U.S. economy that's growing too slowly.
Stocks closed essentially unchanged Friday as mixed economic news and earnings data failed to distract traders from next week's mid-term elections and Federal Reserve policy statement.
Analysts lately have loudly proclaimed the end of the dollar, leaving investors looking to stay ahead with a choice of betting on stocks, which have 17% fallen in the last decade, or staying "safe" in very low-yield money market funds. But there is an alternative: commodities.
China surprised international markets Tuesday by raising key interest rates for the first time in three years. The move sparked a worldwide sell-off on worries that it could cause the Chinese economy to slow down.
Besides the unemployed, nobody is getting hurt worse in this economy than seniors. Prices on many commodities are skyrocketing, but the Consumer Price Index, which is the yardstick used to adjust Social Security for inflation, is virtually unchanged.
Stocks closed mixed Friday as Google's strong earnings lifted tech stocks but mounting concern over the foreclosure crisis and a revenue miss from GE weighed on financials and the broader market.
Producer prices rose a higher-than-expected 0.4% in September, but the core rate rose just 0.1%, the Labor Department said. The price increases point to a low-inflation environment, easing concerns that the world%u2019s largest economy will lapse into a dangerous deflationary spiral.
Kansas City Federal Reserve President Thomas Hoenig broke ranks with some of his fellow regional Federal Reserve executives Tuesday, warning against further monetary action as a way to spur economic activity.
The minutes of the FOMC's September meeting show more quantitative easing may be needed "before long," but the bankers delayed any moves while waiting for more data.
The Federal Reserve chief warned Monday that the government must figure out how to shrink huge budget deficits, which now pose a "real and growing" threat to the U.S. economy.
The Swiss franc has been a top currency over the past six months, outpacing the dollar by 8.9% and the euro by 7.8%, thanks to shaky conditions in Europe. But some signs suggest the Swiss currency is due for a correction.
The recent stream of modestly positive economic news means the Fed probably won't take any further action to stimulate the economy at its upcoming meeting. But nobody is calling the economy healthy yet.
