The Federal Reserve sharply stepped up its efforts to bolster the economy on Wednesday, announcing that it would pump an extra $1 trillion into the financial system by purchasing Treasury bonds and mortgage securities.So, the Fed will print up worthless money to buy worthless debt. The fact that the Fed is buying long-term debt tells you that there is not enough spare private investment capital in the market to create a genuine demand for the debt the Treasury is selling.
Having already reduced the key interest rate it controls nearly to zero, the central bank has increasingly turned to alternatives like buying securities as a way of getting
more dollars into the economy, a tactic that amounts to creating vast new sums
of money out of thin air. But the moves on Wednesday were its biggest yet, almost doubling all of the Fed’s measures in the last year.
Am I the only one who is inspired to horrifying visions of Weimar America?