The Fed is really between a rock and a hard place. Past QE programs have been blamed for spikes in commodity prices, offsetting the benefits of the additional liquidity on asset prices like stocks and bonds. There has been a sharp political backlash against those sorts of interventions as well. Recognizing this, Bernanke has turned the focus back to the politicians, essentially saying the ball is in their court.
The stakes for Obama when he lays out his jobs plan next Thursday are quite high. If it is more warmed-over lefty feel-good pablum like “green jobs”, the markets will be in for a thumping.