) --

Federal Reserve Chairman

Ben Bernanke will be center stage at the

Federal Open Market Committee

meeting today. Will investors be greeted by some big news from Bernanke? Is there a so-called "Operation Twist" in the works that will rejuvenate the economy?

Highly unlikely on both fronts. The sad reality is the Fed just doesn't have a lot of punch left. Twisting the yield curve is clever, but will probably just be more theater in the vein of quantitative easing -- motion as the illusion of progress. The Fed has to do something, and a yield "twist" is it this time around.

Federal Reserve Chairman Ben Bernanke

On top of that, Bernanke and the rest of the Fed are not very interested in making a lot of controversial moves right now as critics sharpen their knives -- and tempers flare within the Fed itself.

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Throw in already rock-bottom Fed funds rates and a rough economy that prevents raising rates, and it all adds up to a whole lot of nothing from the Federal Reserve -- today, tomorrow, and across every day for the next two years.

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Just about the only thing the Federal Reserve can do is the so-called "Operation Twist" of the 1960s that has been making headlines. The effort will involve twisting the yield curve, swapping shorter-maturity government securities for longer-dated ones.

The Fed theoretically will sell its debt with a maturity date of less than three years and buy mostly seven- to 10-year notes -- lowering long-term borrowing rates to encourage mortgage refinancing and other borrowing. The program could range from $200 billion to $700 billion.

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It's a novel concept. But will it work?

Like QE2, it could just be the Fed spinning its wheels to avoid looking like it's doing nothing. Other kinky policy ideas have been floated as possibilities, but the bottom line is that they are all extraordinary measures -- and most are untested or suspect in their impact on the broader economy.

QE3 is Dead In the Water

Some folks think Bernanke will push for another round of quantitative easing, too. As recently as August -- as the bottom was dropping out of the market to the tune of 15% in about two weeks -- comments by several Fed officials hinted at another round of "quantitative easing" if the economy continues to deteriorate.

But the reason we are discussing

Operation Twist

and the reason QE3 has yet to materialize is that the political environment in Washington is not conducive to those efforts. Heck, Congressional Republicans just sent a rather dry letter to the Fed this week that essentially warned that another round of quantitative easing or stimulus efforts would result in all-out war from right-wing politicians.

And aside from philosophical and political arguments about the role of the Fed -- to say nothing of long-term inflationary fears -- the bottom line is that QE2 was a bust.

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After some economists warned of inflation risks (which proved to be true, vis-à-vis the resulting spike in commodity prices) and Republican members of Congress criticized the Fed's plan as "printing money out of thin air," any further easing would be troublesome to pull off. Everyone will be saying, "QE2 helped the stock market but did little to lift the economy. Why would QE3 be any different?"

To embark on another iffy voyage of quantitative easing in a hostile political environment -- before an election no less -- seems highly unlikely.

The Fed funds rate has been effectively zero since December 2008. And for those of you who were listening to Ben Bernanke in early August, it will keep interest rates at record lows until mid-2013. There's no way that is changing Wednesday.

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The federal funds rate is the central bank's key tool to spur economic growth. And unfortunately, growth isn't very impressive at all. The IMF just lowered its growth estimate for the U.S. to 1.5% GDP expansion this year and cut the entire globe's growth prospects from 4.3% expansion to 4%.

The central bank is waiting for a sign that the economy is out of danger before raising rates -- and they'll be waiting for a long time. The debt crisis in Europe weighs on the market, unemployment remains high, housing remains brutalized and consumers are starting to get jittery again.

Until meaningful progress is made on most of these fronts, it's going to be near-zero rates at the Federal Reserve.

Will There Be Fireworks?

So with a lack of options for policies that actually have punch, investors shouldn't expect anything new or interesting from the

Fed FOMC meeting


The only question is whether the Fed will continue to keep up this act or whether we might see more internal squabbles.


going to be the real news.

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The FOMC had three dissents to its Aug. 9 statement signaling rates might stay near zero for two years. The quantitative easing issue also is divisive.

To top it all off, inflation fears are front-and-center after packaged foods giant


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reported disappointing earnings -- including a 42% drop in quarterly profit thanks to a 15% jump in input costs. Other earnings reports in the coming days might tell a similar story. There was heated debate over the last round of Fed purchases as some warned of a steep spike in commodity prices caused by QE2 that had no real impact on growth. Some talking heads might reopen these old wounds tomorrow to make political hay or offer up juicy soundbites.

But beyond this soap opera of Fed infighting, the news of the day is likely to be more of the same: low rates, a stagnant economy and little the Federal Reserve can do to change things.

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This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.