Question: Fed Chairman Ben Bernanke said in part "We could begin (tapering) later this year. But even if we do that, the subsequent steps will be dependent on continued progress in the economy. So we are tied to the data. We don't have a fixed calendar schedule."

Answer: In plain-speak, we believe - as do many of our colleagues - that the Fed has actually boxed itself into a corner. It's actually tied to a lot more than just the data! Its efforts to keep rates low and provide liquidity to stimulate the economy have produced uneven results and caused distortions that are not likely to be unwound anytime soon. If it keeps printing money to buy government debt, things are likely to limp along with high unemployment, more discouraged people failing to seek even the few available low-paying entry level jobs, and a continued hollowing out of the middle class. If they 'taper' and ease off on bond purchases, rates go up, choking off the less than optimum recovery we've been seeing lately. Think of it as a metaphor, where the Fed is driving down a deeply rutted road, with the best case scenario being just more of the same.