Short Term Interest Rates Are Going Up

Alhambra: Welcome Jay Powell, The Circular Hawk
For him to privately dissent (the official vote was unanimous, and it always was going to be unanimous) at that moment against QE3 on those grounds is beyond concerning. He told Chairman Bernanke, “I’m supporting [QE3] with a certain lack of enthusiasm, and I am somewhat uncomfortable with the road that we are on.” At a time when even the most formerly optimistic Economist on the Board and in the system was worried, Powell was totally unmoved.

Not that QE3 in reality did all that much, but clearly the economy needed something (somebody to stop the “rising dollar”, not more “stimulus” that the future Chairman was forthright in at least challenging its efficacy). In Powell’s mind, in the middle of the 2012 slowdown, nope. The world was going to get better because the world is going to get better.

...MR. POWELL The question that looms is—and I’m going to, again, leave aside monetary policy—when do we break out of this? And I really do believe that we will. We always have. I can remember many of these cycles where you really wonder if this is it and we’re never going to get out. I really do feel that if you look at our own projections, essentially, all of us project that we’re going to have those 3 percent, 4 percent catch-up years. They’re now scheduled for 2014 and ’15, but really, there’s a ton of uncertainty around that.
Everyone is as certain now as they were back then.
The slowdown in business lending looks unlike the sharp peaks in 2000 and 2007, and more like the slowdown in the early 1990s:

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