The Fed’s Contradiction

The Fed’s Contradiction

WSJ – Four years ago this month the Federal Reserve began its epic program of monetary easing to rescue an economy in recession. On Wednesday, Chairman Ben Bernanke declared that this has worked so well that the Fed must keep easing money for as long as anyone can predict in order to save a still-sputtering recovery.

That’s the contradiction at the heart of the Fed’s latest foray into “unconventional policy,” which is a euphemism for finding new ways to print money: The economy needs more monetary stimulus because it is still too weak despite four years of previous and historic amounts of monetary stimulus. In the words of the immortal “Saturday Night Live” skit: We need “more cowbell.”

In his press conference Wednesday, Mr. Bernanke was at pains to say this week’s decisions were nothing new, merely an implementation of the policy direction that the Fed’s Open Market Committee had set in September. This is technically true, but the timing and extent of the implementation are more than details.

The Fed committed Wednesday to purchase an additional $45 billion in long-term Treasury securities each month well into 2013, in addition to the $40 billion in mortgage assets it is already buying each month. At $85 billion a month, the Fed’s balance sheet will thus keep growing from its current $2.9 trillion, heading toward $4 trillion by the end of the year. Four years ago it was less than $1 trillion.

More

Get Free Email Updates!

Signup Now to Receive Updates and Alerts!

We will never give away, trade or sell your email address. You can unsubscribe at any time.

@https://twitter.com/candicelanier

Candice writes for several publications, including The Christian Post, Red State, The Black Sphere and Patriot Update. She is the Science & Tech Editor at the Minority Report Blog and the founder and Editor-in-Chief at Front Lines. She's also the founder of Candice Lanier's Tech News and works as a computer consultant. Additionally, Candice is an antiques dealer.

More in

Screen-Shot-2014-01-11-at-5.43.12-PM

Convention of States Movement Adds Alabama

Steve FoleyMay 22, 2015
Clinton_Spars_With_Senator_on_Benghazi.jpg

Top Aide’s Pre-Benghazi Email: Hillary Clinton Had ‘Leadership/Ownership/Stewardship of This Country’s Libya Policy From Start to Finish’

Steve FoleyMay 22, 2015
Meida Bias 2

Most Voters Expect Biased News Coverage of 2016 Presidential Race

Steve FoleyMay 22, 2015
obamacare-sticker-shock-obama

Obamacare: ‘Premium Increases Next Year May Shock You’

Steve FoleyMay 22, 2015
hillary-clinton-email-memes_2

New Documents Showing That The National Archives Was Aware Of Hillary Clinton’s Private Email Use

Steve FoleyMay 22, 2015
boehner-iraq

Boehner To Obama: Get A Strategy On ISIL

Streetwise_ITMay 21, 2015

The Minority Report is a network of websites devoted to Conservative & Libertarian politics in the United States. In 2014 the network had over 20 million page views!

On this site you'll find posts & links to some of the best and most comprehensive center-right news and opinion on the net...

December 2012
M T W T F S S
« Nov   Jan »
 12
3456789
10111213141516
17181920212223
24252627282930
31  

Archives

Copyright © 2014 The Minority Report Network