Minutes of the Federal Open Markets Committee sept 2011

[STEVEN SEVERINO]

http://www.federalreserve.gov/monetarypolicy/files/fomcminutes20110921.pdf

[mit26chell]

T4P ;)

Most participants indicated that they favored taking
steps to increase further the transparency of monetary
policy, including providing more information about the
Committee’s longer-run policy objectives and about the
factors that influence the Committee’s policy decisions.
Participants generally agreed that a clear statement of
the Committee’s longer-run policy objectives could be
helpful; some noted that it would also be useful to clarify
the linkage between these longer-run objectives and
the Committee’s approach to setting the stance of
monetary policy in the short and medium run. That
said, a number of participants expressed concerns
about the conceptual issues associated with establishing
and communicating explicit longer-run objectives for
the unemployment rate or other measures of labor
market conditions, inasmuch as the long-run equilibrium
levels of such measures are influenced importantly
by nonmonetary factors, are subject to change
over time, and are estimated with considerable uncertainty.
In contrast, participants noted that the long-run
level of inflation is determined primarily by monetary
policy. Accordingly, many felt that if the Committee
were to reach a consensus on more explicit statements
of its longer-run objectives, it would need to provide an
in-depth explanation to the public of how those objectives
were determined and how they fit into the policymaking
framework. Participants generally saw the
Committee’s post-meeting statements as not well suited
to communicate fully the Committee’s thinking about
its objectives and its policy framework, and agreed that
the Committee would need to use other means to
communicate that information or to supplement information
in the statement.
Most participants also indicated that they saw advantages
in being more transparent about the conditionality
in the Committee’s forward guidance by providing
more information about the economic conditions to
which the guidance refers. They judged that such a
step could make the Committee’s forward guidance
more effective and increase the likelihood that financial
markets would respond to incoming economic information
in ways that would help monetary policy
achieve its goals. However, several participants saw a
risk that any explicit statement of economic conditions
specified in the Committee’s forward guidance could be
mistaken for a statement of its longer-run objectives.
Others thought this risk of misinterpretation could be
managed through careful communications. A number
of participants suggested that the Committee’s periodic
Summary of Economic Projections could be used to
provide more information about their views on the
longer-run objectives and the likely evolution of monetary
policy.

[STEVEN SEVERINO]

So Basically stating the point in terms of creating jobs, they are more inclined to fund longer term debt in order to reduce the unemployment rate. According to this release, they are anticipating the J*obs B*ill by O*Bama will be passed. They are allocating roughly 400 billion, the same amount as the plan by O*b#ama