End of QE2 may prompt another recession

ON ASSET ALLOCATION

Architas' Dawn Kendall explains why she is concerned about the end of quantitative easing in the US.

After signs of stirring in the labour market and meaningful improvements in other areas were recorded at the end of 2010 and earlier this year, recent data suggests the US economy is hitting a soft patch. Q1 GDP slowed significantly from last quarter. This revelation hit the newswires shortly after S&P placed a negative outlook on the US AAA credit rating. Also of concern is the cessation of the second US programme of quantitative easing. It is moot how the Fed will move in terms of next steps.  This uncertainty will be significant as any period of inaction, or lack of direction, from...