Tags: Bianco | Fed | Policy | Counterfeiting

Jim Bianco: Fed Policy Is Really Just Counterfeiting

Tuesday, 21 Feb 2012 08:20 AM

The Federal Reserve has purchased $2.3 trillion in assets from banks to flood the economy with liquidity and drive down interest rates in order to stimulate the pace of economic recovery.

Under such policy, known as quantitative easing, the Fed goes in and buys assets like Treasury instruments or mortgage-backed securities from the banks, crediting those banks' reserve accounts with the funds, in what critics says is basically money printing.

"The ability of the Fed to increase the amount of money in banks' reserve accounts; that's what most people mean when they talk about money printing and that's under the direction of the Fed," says Jim Bianco, president of Bianco Research, according to The Daily Ticker, a Yahoo! news venue.


Editor's Note
: Exposed: You Owe It to Yourself to Learn What Obama and Bernanke Are Hiding From Americans

 

"If you or I did that it would be fraud, it would be counterfeiting and we'd go to jail," Bianco adds.

"But when the Fed does it, it's sophisticated monetary policy."

The Fed says quantitative easing was necessary to steer the country away from crippling deflation while doing the best it can to maximize the jobs situation.

Critics say it will fuel inflationary pressures down the road, has cheapened the dollar and really hasn't done that much for price stability and jobs recovery anyway.

The Federal Reserve has already carried out two rounds of quantitative easing so far (known as QE1 and QE2), and talk is brewing that a third round (QE3) is up for consideration at the Federal Reserve, where some policymakers remain frustrated with the pace of economic recovery.

Some Fed officials, however, have made it clear that enough is enough.

"There will be no QE3," Dallas Fed President Richard Fisher said recently, according to Reuters.

"I will support no QE3, no additional mortgage-backed securities, no additional Treasurys," Fisher says, adding it's up to the government to cut spending and get its fiscal house in order and not monetary policy authorities.



Editor's Note
: Exposed: You Owe It to Yourself to Learn What Obama and Bernanke Are Hiding From Americans

 


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2012-20-21
Tuesday, 21 Feb 2012 08:20 AM
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