“I’m sorry, America,” writes Andrew Huszar, formerly of the Federal Reserve, where from 2009-2010 he was in charge of “Quantitative Easing” — also known as “buying huge amounts of bonds with money created by the Fed for that purpose.” (For a good explanation of what that actually means, you might want to check out this Planet Money piece from 2010.) In an opinion piece published by the Wall Street Journal, Huszar concludes that QE (as the cool kids call it) was (and remains) a mistake. [More]
The Fed is widely expected to tomorrow announce the latest round of monetary policy tweaking designed to loosen up markets. It has the cute name of “Operation Twist.” Here’s how it works.
Still don’t understand quantitative easing? Is it really just “printing money” or something more subtle? These animated xtranormal pig bunnies seem to have a grasp, at least judging by the millions of hits this movie of them explaining it has gotten. “The only thing deflating is the Fed’s credibility,” says one pig bunny to the other.
The Fed sent out signals that it could be making a major new move as soon, which experts think could take the form of buying back up to $500 billion in Treasury Bonds. They could decide as soon as their next meeting on November 2nd, which also happens to be Election Day.
Markets edged upwards Monday, betting that the Federal Reserve will vote tomorrow to inject more money into the system by buying up more mortgage-backed securities and Treasuries.