There's been a lot of talk about the effectiveness of QE policies and whether they've been worthwhile. I think the ultimate answer can be summed up in two words: why not? The main concern about QE is the potential for runaway inflation, but that's simply not happening, even after five years of increasing the money supply. The fact is, Americans (consumers and businesses) are saving more than spending. While that's the case, inflation will simply not occur. Plus, if inflation does start to show up in the data, it won't happen overnight. Thus, the Fed will have plenty of time to react. Don't forget, the Fed has a strong history of being able to combat inflation. As long as fiscal policy is off the table, there's no reason for the Fed not to try any method possible to spark economic growth.

Jay Soloff

Anecdotally, it seems like the excitement over Black Friday is greater than usual. And yes, the malls do seem to be getting decent sized crowds. From a macro perspective, the early surveys are showing a stronger likelihood of higher holiday spending than in recent years. We'll have to see, but I believe we're on pace for a strong retail season in the US.

James Marlay

Good points Jay. I am interested in the lowering of household debt and also implications for retail spending over Christmas. From someone on the ground in the states what is your take on sentiment and the likelihood that families will splash out a little over Christmas? Are the malls getting busy?