What else can the Fed do?

 (Photo credit: CityGypsy11)

NEW YORK (CNNMoney) -- Hiring has slowed, economic growth has eased, inflation is tame and millions of Americans remain unemployed. In short, the recovery is stalling.
But after more than three years of trying to stimulate the economy, what else is the Federal Reserve to do?. That's the predicament Fed Chairman Ben Bernanke and his crew will face this week, as the Federal Open Market Committee meets in D.C. Tuesday and Wednesday.
Should they chose to act soon, here are some options on the table:

1. Extend Operation Twist

Likelihood: High

Dubbed Operation Twist, this policy swaps $400 billion in short-term bonds for ones with a longer duration. The aim is to push down long-term interest rates, thereby making it cheaper for businesses to get loans and consumers to get mortgages and other forms of credit.

While it's unclear just how effective Operation Twist has been so far, it is true that long-term rates have come down since October, when the program started. Simultaneously, mortgage rates have fallen too. ... Continue to read.

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