Bernanke will scuttle QE3 at first sign of inflation

Commentary: Fed acted because of concerns about Europe, China

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Financial markets are still trying to digest the Fed’s QE3 announcement (and the prospect of intervention by other central banks around the world), as well as newly arriving economic reports.

The big stuff is due next week (ISMs and jobs), but some jigsaw pieces this week were useful. Orders for durable goods crashed hard, down 13.2 percent in August, but only 1.6 percent excluding volatile transportation orders — and the index itself is volatile. Household incomes rose only 0.1 percent in August, consistent with flat wages.