John Ransom
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As the Federal Open Market Committee (FOMC) of the Federal Reserve Bank meets to decide if it will or won’t tighten the money spigot known as QE, my bet is that the Fed stands pat.

Of course, that means I’m probably wrong, because the Fed never does the thing I think it ought to do, even the thing I think it will do.

But for better or worse here are my reasons:

1) The strength in the economy is more apparent than real. Our friends over at Political Calculations have done some investigation into apparently “robust” economic growth that the economy witnessed in the third quarter of 2013. What they found was that growing conditions were almost perfect for crops around the country. As a result, the U.S. was able to boost GDP—and exports—through bumper crops. From Political Calculations:

We drilled down into the Census' data on what the U.S. exported to China. And what we found is that the U.S. exported a record amount of soybeans to China in October 2013, the value of which accounted for 22.6%, or nearly $1 out of every $4 of the value of all $13.060 billion worth of the U.S.' exports to that nation, accounting for nearly all of the year-over-year increase.

So where did all these soybeans come from? Because they definitely weren't there last year....

It turns out that weather conditions in 2013 across all of North America were nearly ideal for growing just about every crop grown in the U.S., with the result that U.S. farmers were harvesting bumper crops of just about everything they grow in August and September 2013.

Those bumper crops, in turn, solves a different mystery: why did the U.S.' GDP unexpectedly grow so much on increased business inventories in the third quarter of 2013?

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John Ransom

John Ransom is the Finance Editor for Townhall Finance.