Newspaper article St Louis Post-Dispatch (MO)

Mound City Money

Newspaper article St Louis Post-Dispatch (MO)

Mound City Money

Article excerpt

Highlights from David Nicklaus' blog about St. Louis business.

Bullard says he would have voted against QE3

Jim Bullard, president of the Federal Reserve Bank of St. Louis, says he would have voted against the new bond-buying program that his Fed colleagues launched last week.

Bullard doesn't have a vote this year on the policy-setting Federal Open Market Committee, but he will be a voting member in 2013. Voting privileges rotate each year among regional Fed presidents. In an interview on Tuesday, Bullard told Reuters that he thought QE3 - the quantitative easing program announced on Sept. 13 - was a premature response to sluggish economic growth.

"We should take a little bit more (of a) wait-and-see posture. ... I would have voted against it based on the timing. I didn't feel like we had a good enough case to make a major move at this juncture," he said.

Bullard did acknowledge that the structure of QE3 was in line with his ideas on how to conduct a quantitative easing policy. As I explained last week, he has long advocated an open-ended bond- buying policy that could be reviewed at each FOMC meeting. When the Fed announced its earlier rounds of easing, known as QE1 and QE2, it set specific dollar targets and sunset dates. Here's the section of the Reuters story where he addresses QE3's structure:

"Even so, Bullard said some of the contours of the plan, which has no set end date, were in keeping with how he thinks monetary policy should be conducted with interest rates already near zero. Leaving end dates off a bond buying program can make the policy 'more effective,' he said.

"'We should go meeting by meeting with any balance sheet policy,' Bullard said."

And in the debate over whether the Fed should tolerate a little more inflation to stimulate job growth, Bullard declared himself to be firmly in the inflation-hawk camp:

"I don't think there's a lot of benefit from inflation."

Technology group gets $45,000 grant

The Information Technology Entrepreneur Network, a group that promotes and advises early-stage technology companies in St. Louis, has received a $45,000 grant from the Ewing Marion Kauffman Foundation of Kansas City. …

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