I have set up a 401(k) and I have bonds.
When the Federal Reserve buys more treasuries (today's news) what's the effect on bonds?
Should I sell my bonds or buy more?
The fundamental value of a treasury bond is determined by the coupon rate it pays and the time remaining until it matures. The primary determining factor in the price available in the open market for a treasury is the interest rate environment. If the market expects rates to increase in the future, the market value of bonds will fall to compensate for this. The longer the duration of the bond, the more it's price will be affected by changes (or expected changes) in interest rates.
When the Fed purchases treasury bonds using new dollars that didn't previously exist, it is increasing the supply of money to the market. This could cause inflation to increase, but then it might not. Many factors affect the money supply and nobody can say for sure what the impact of an announcement like today's will be. If inflation were to increase, it would make (nominal) treasuries a less attractive investment as the real rate of return would decrease.
As a long term investor in a retirement plan, none of this should really matter to you. The best way for a retail investor to invest in bonds is to hold them until maturity and avoid speculation about the bond's market price. Treasuries have a guaranteed rate of return (excluding inflation) - no news announcement can affect that.
Your portfolio should be balanced between equities and bonds to suit your risk appetite. Changing the balance of your portfolio based on today's news is unlikely to be a good idea unless you can predict the future.
If you are particularly concerned about inflation, you may want to consider including TIPS as well as nominal bonds in your portfolio.