Fed's Stimulus Program Is Creating Jobs In Auto And Housing Markets; Bernanke Will Be Able To Give Positive Testimony To Congress This Week

Monday, February 25, 2013 08:50
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Fed's Stimulus Program Is Creating Jobs In Auto And Housing Markets; Bernanke Will Be Able To Give Positive Testimony To Congress This Week

Tags: economic indicators | Federal Reserve | markets

The Fed’s accommodative policies seem to be spurring job creation in the auto and housing industries.
 
In his testimony before Congress this week, Fed chief Ben Bernanke will have that pleasant message to deliver. Those sectors are the two most responsive to the quantitative easings currently in force through the monthly purchases of Treasury and mortgage-backed securities by the Fed.

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The Federal Open Market Committee (FOMC) has pledged to continue the purchases until it sees significant improvement in the labor markets.
 
Expectations for job growth are about the same for this year as last year but are expected to rise from 2 million new jobs to 3 million in 2014 as well as in 2015.
 
Chemical companies that manufacture goods for the housing market are also benefiting from the Fed’s stimulus package.
 
In the minutes from the FOMC’s January meeting, most officials conceded that the monthly purchases have helped stimulate economic activity.
 
Home Depot, the nation’s largest home-improvement retailer is adding temporary jobs but many of those are expected to turn into full-time positions.
 
Last year, over half of the 70,000 temporary workers at the retailer were offered full-time positions.
 
The S&P 500 index is up 6.1% since the Fed announced on December 12 it would continue its stimulus program. The index has risen approximately 12% over the last 12 months.

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