Jackson Hole Could Be A Big Letdown For "QE3"

Federal Reserve Chairman Ben Bernanke is many things, but magician is not one of them, and there is little to no chance that he announces a third round of quantitative easing tomorrow.

is out with an article today discussing why Bernanke may in fact forego a third round of quantitative easing, despite many investors clamoring for it. Benzinga has

the possibilities for a third round of QE, and the consensus amongst market pros is that

tomorrow, or even hinted at. Last year at Jackson Hole, Bernanke said the Federal Reserve would do whatever it took to get the economy going, which investors took as a sign that an additional round of quantitative easing was coming. The Fed officially announced a second round of quantitative easing, known as "QE2," back in November. It purchased $600 billion in U.S. Treasuries between then and June 2011. The Federal Reserve has said they will use tools “as appropriate,” Roberto Perli, managing director at International Strategy & Investment Group in Washington told Bloomberg. In recent days, many Fed officials have talked down the importance of tomorrow, saying Bernanke is not

“You'll learn when you hear him speak. Ben Bernanke's not the tooth fairy. His job is not to leave presents under the pillow of people who have desires that may not be easily fulfilled. Our job is to put things right in the long term,” said Federal Reserve Bank of Dallas President Richard Fisher. With inflation on the rise, the threat of deflation is no longer a major issue. Deflation was one of the major reasons for a second round of quantitative easing. As such, stock investors are likely to be disappointed tomorrow morning. “The stock market is going to be disappointed Friday morning,” Rob Dugger, managing partner at Hanover Investment Group LLC said in an interview on Bloomberg Radio's “The Hays Advantage.” “It's not going to get that kind of life-buoy thrown out over the water so that it can grab hold and swim safely to shore,” he said. Bernanke's speech is entitled “Near- and Long-Term Prospects for the U.S. Economy.”