Will the Fed Put a Damper on QE, Raise the Bank Lending Rate?

Interesting tidbit that came out of the FOMC minutes today was that

"some participants noted that if the very large size of the Federal Reserve's balance sheet led the public to doubt the Committee's ability to withdraw monetary accommodation when doing so becomes appropriate, the result could be upward pressure on inflation expectations and so on actual inflation. To mitigate such risks, it was noted that the Committee should continue its planning for the eventual exit from the current exceptionally accommodative stance of policy." - Briefing.com

Whether or not the Fed has any real intention of changing its monetary policy over time has yet to be seen and is certainly up for debate. The fact is though, that at some point in time they will have no choice. In any case, it will be interesting to see if this blurb gets any notice in terms of trading action over the coming days. It could be just the type of dissension that allows some selling to enter the market. Selling is a rare bird these days. The fact that some Fed participants acknowledge the need for a change in policy may be just the edge that some of the big money managers need to let go of some of their positions...

Just a thought...

See FOMC Minutes here.