The Fed Already Shocked The World When it Indicated its Ultra-Low Interest Rate Policy Would Remain in Place Until 2013

America is still cloudy, Here is the short view for this month, Stocks have been giving up gains won after last year's speech, when Bernanke hinted at plans to pump more money into the financial system. Oil prices are higher and there's been little improvement in the job market. Bond yields are down, though, because the economic outlook has deteriorated.

Some analyst says, "It's almost as if QE2, the Fed's $600 billion bond-buying program first mentioned at last year's meeting and designed to boost the struggling economy, never happened. That's not to say investors doubt the central bank's resolve to act again if the U.S. economy keeps losing steam. Last week, it surprised markets with an unprecedented pledge to hold interest rates near zero until at least 2013"

"The Fed already shocked the world when it indicated its ultra-low interest rate policy would remain in place until 2013," said Fred Dickson, strategist at D.A. Davidson & Co in Lake Oswego, Oregon. "That telegraphed the economy is going to stay weak. But monetary and fiscal policies haven't worked very well, so I don't expect we'll get a QE3 announcement. That would really catch everybody by surprise."