Fed Chairman: Who’s Ready To Print Some More Money?
“Fed chair Ben Bernanke stopped just short of calling for a third round of quantitative easing in a speech this morning, but there isn’t much mystery now as to whether the Fed will intervene,” writes Ed Morrissey. ” The only question is when.”
The Federal Reserve chairman, Ben S. Bernanke, delivered on Friday a detailed and forceful argument for the benefits of new steps to stimulate the economy, reinforcing earlier indications that the Fed is on the verge of action.
Mr. Bernanke said that the Fed’s policies over the last several years have provided significant benefits, but that a clear need remained for the Fed to do more and that, in his judgment, the likely benefits of such actions outweighed the potential costs.
“It is important to achieve further progress, particularly in the labor market,” Mr. Bernanke said in his prepared remarks. “Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability.”
Mr. Bernanke did not announce any new steps in his speech, delivered before an annual monetary policy conference organized by the Federal Reserve Bank of Kansas City. Nor did he offer a timetable, although many analysts expect the Fed to act at the next meeting of its policy-making committee on Sept. 12 and 13.
Maybe it’s time to admit that the Federal Reserve can’t fix what ails the American economy? Our problem is not money supply that is too tight. In fact, QE (which is basically printing money to expand the monetary supply) hurts all of us in that it devalues the money we already have, making us all poorer.
Yesterday I wrote about seniors – who rely on investment and interest income – having a tough go of it thanks to rock-bottom interest rates even as the face a dramatic increase in taxes on interest and investment income should Democrats get their way on the Bush tax cuts. More inflation would also impact seniors disproportionately as inflation would continue to grow faster than their interest rates.
A CD getting less than 1% interest isn’t keeping up with inflation now, and that would only get worse by further inflating our monetary supply.
Maybe it’s time to admit that the problem with America’s economy is too much government intervention, not too little.Tags: ben bernanke, federal reserve