Bloomberg: Federal Reserve officials will maintain their holdings of securities to prevent money from being drained out of the financial system in their first attempt to bolster the economy in more than a year.
The central bank said it will reinvest principal payments on its mortgage holdings into long-term Treasury securities. The Fed retained a commitment to keep its benchmark interest rate close to zero for an “extended period.”
“The pace of economic recovery is likely to be more modest in the near term than had been anticipated,” the Federal Open Market Committee said in a statement after meeting today in Washington. “To help support the economic recovery in a context of price stability, the Committee will keep constant the Federal Reserve’s holdings of securities at their current level.” --
Full text
Official Fed Statement
Comment: Silly is who silly does. The Fed has produced the mess, and now it makes sure that the mess will continue. First Greenspan, Bernanke & co created bubbles, fabricated bailouts, printed money like crazy and put the economy on an unsustainable path. When the bust came the monetary authorities continued to do the same, and this time even more so. When they noted that there remedies don't work, they decided: maybe more of the same will do the job. This way they will go on with a monetary policy that exists in heaping the next problem above the mountain of the existing problems that have been created before by the same kind of measures. Bernanke plays according to the model of his macroeconomic textbook where all kinds of macro aggregates act but no human beings exist and no learning takes place.
No comments:
Post a Comment