The Federal Reserve is destroying our currency. The dollar is worth less and less as these fools print more and more of them. As the dollar weakens, it takes more of them to buy the products we need. Ben Bernanke is supposed to be an expert on the Great Depression which makes me wonder if he is intentionally taking us into an even greater one. - Reggie
Now the spigot is open — wide open. QE III is here. And the Fed is about to become a campaign issue, whether it likes it or not.
Chairman Ben Bernanke announced Thursday that the Fed would spend $40 billion a month on mortgage-backed securities with no set date to end those purchases.
“If the outlook for the labor market does not improve substantially,
the committee will continue its purchases of agency mortgage-backed
securities, undertake additional asset purchases and employ its other
policy tools as appropriate,” said the Fed in a statement.
The Fed’s action is primarily aimed at the short term. Though there
is no sign of inflation, rising food and gas prices have created
inflation fears among Americans. People don’t care about price indexes they care about prices. Printing money won’t be popular.
The perception will almost certainly be that the Fed is trying to
bail out Washington, and specifically the Obama administration. At one
point, the Fed was polling behind the IRS in popularity,
and open-ended money printing can only corrode confidence in the
institution even further. Voters are going to have a tough time
compartmentalizing monetary policy from Obama policy — and in many ways
it’s the same.
There was QE I and II, Operation Twist,
and a trillion-dollar stimulus — and another trillion-dollar yearly
Keynesian deficit the federal government runs – and the economy has
still stalled. Making the counterfactual argument that it could have all
been worse is a tough sell, and arguable.
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UPDATE: The result of the Fed Chairman's announcement that the Fed is going to print more money is this...
CNBC: US Credit Rating Cut by Egan-Jones ... Again
Ratings firm Egan-Jones cut its credit rating on the U.S. government to "AA-" from "AA," citing its opinion that quantitative easing from the Federal Reserve would hurt the U.S. economy and the country's credit quality.