http://gonzalolira.blogspot.com/2011/03/how-likely-is-qe-three.html is worth a read. Or, is this territory so familiar that its beyond obvious?
Here's the money quote:
"What we should look at is the simple, macro question: If the Fed ends QE-2 in June as they have said they will, who will take up the slack? Who will purchase between $75 and $100 billion worth of Treasury bonds at yields of 3.5% for the 10-year?
Is there someone?
The answer is, No one will take up the slack."
There's quite a nice riff about what "THEY" might well do to your retirement accounts (401K / IRA). That's where I have a little more than 3/4s of my savings. I think it will be a lot easier, politically, to seize the retirement accounts via hyper-inflation rather than by actually forcing them to buy government bonds and that will be what happens. Gonzolo agrees.