Ben Bernanke's announcement today of $600 billion of QE 2 (money printing) sparks criticism from many people. Experts from Joseph Stiglitz, the Nobel-winning economist, to Bill Gross, head of the bond-management giant, Pimco, have already predicted it will be either ineffectual or dangerous.
The dollar is in danger of losing 20 percent of its value over the next few years if the Federal Reserve continues unconventional monetary easing, Bill Gross, the manager of the world's largest mutual fund, said on Monday... ReutersGlenn Beck takes this swipe at the Fed's Ponzi scheme:
David Goldman / Inner Workings:
Dave’s Top 10 Reasons Why QE Won’t Help the Economy' --
3. Inflation, as even the Fed will admit, helps some people and hurts others. The idea is that it will help more people than it hurts by forcing investors to buy real assets. The kind of inflation that QE is likely to cause will have an almost entirely damaging impacta on the US. In fact, the devaluation of the dollar and the rise in raw materials prices will hurt every American household and most American businesses; it will benefit Middle East oil producers, Vladimir Putin, Aussie mining companies, and all sorts of people who don’t live in the United States.
1. It undermines the dollar’s world reserve currency role. That’s why gold keeps going up. If the US were Greece or Ireland, we’d be in front of the International Monetary Fund in sackcloth and ashes right now. But we’re the world’s only superpower, and the central banks of the rest of the world have to hold their reserves in dollars. Why? Because there isn’t enough of anything else (unless the price of gold were to go to $10,000 an ounce, which I doubt) and because they hate each other more than they hate us — at least for the moment. With Obama shrinking America’s strategic footprint and the Fed behaving like the neighbor whose septic tank overflows onto everyone else’s lawn, Washington is testing the world’s patience. It will have consequences.
Paul Krugman: QE2 Meh ...John Quiggin / Crooked Timber: QE2 — The US Federal Reserve has announced its long-awaited renewal …Mark Thoma / Economist's View: The Fed Will Purchase $600 Billion in Treasury Securities
For immediate release — Press Release
New York Times: Fed Will Buy $600 Billion in Debt, Hoping to Spur GrowthSudeep Reddy / Real Time Economics: Q&A on QE2: What a Fed Move Would MeanMasaccio / Firedoglake: With Quantitative Easing, Fed Continues War on Small SaversIra Stoll / The Future of Capitalism: The Fed Buys TIPSElizabeth Shell / Online NewsHour: Fed to Engage in Second Round of Quantitative EasingDaniel Indiviglio / The Atlantic Online: Fed To Purchase $600 Billion in TreasuriesPete Davis / Capital Gains and Games blogs: QE2, Good Or Bad? — No, it's not the ocean liner.Calculated Risk: Comments on FOMC statement
Fed to Spend $600 Billion to Speed Up Recovery
discussion:Avi Zenilman / New York Magazine: Inflation, Here We Come? — Ben Bernanke finally made good on his word …
Bryan Caplan / EconLog: Why Did the Fed Commit to Quantitative Easing the Day After the Election?Calculated Risk: FOMC Statement: QE2 Arrives, $600 Billion by end of Q2 2011
Fed to Buy $600 Billion of Treasurys
Jeff Dunetz / YID With LID: The Fed's $600 Billion Dollar Plan For Economic Suicide
Stephen Green / Pajamas Media: IdiocracyPhil Izzo / Real Time Economics: Economists React: Chairman Bernanke's Brave New WorldChristopher Weber / Politics Daily: Federal Reserve to Buy Billions in Treasury Bonds to Boost Economy