Ben Bernanke's about face.

Last month FMOC meeting was reported by Ben Bernanke as raising the issue of "tapering." By which Bernanke told us to expect QE to be reduced and eventually phased out next year - the economy permitting. Other members of the FOMC began to backpedal immediately. The Market responded very negatively: bonds lost value, interest rates began to move up and the Stock Market went into a swoon.

We heard a very different report from Bernanke following the July meeting. Ben said that the 7.6% reported unemployment overstates the ability of the economy to add jobs (otherwise it is a contrived and unreliable number -surprise, surprise) and that “highly accommodative monetary policy” will probably be needed “for the foreseeable future.”

In other words, forget what he said in June, he was not really serious. Stocks went up and interest rates moderated. The economy did not really recover.