The Fed is now blaming Congress for the failures of its QE policies.
This is to be expected, given that no one in the power elite ever accepts responsibility for their own failures. Congressional members blames each other (depending on which party they’re in), the Fed blames Congress, the White House blames the GOP, and on and on.
Behind this façade of bickering is the total and complete failure of the Fed’s policies to generate economic growth OR jobs. Regarding #1, the US has not had a single year of 3% GDP growth since Bernanke became Fed Chairman. End of story.
As for QE… there is not one single example in history in which QE has successfully created jobs. The UK has engaged in QE equal to over 20% of its GDP and hasn’t seen a real recovery in employment. Similarly, Japan has employed QE equal to nearly 25% of its GDP and GDP growth continues to slow while unemployment stays elevated.
As for the US, the Fed has spent roughly $2 trillion in the last year via QE. During that time a little over, 500,000 jobs were created… So the Fed is spending roughly half a MILLION dollars to create each job.
There’s a word for this… it’s pathetic. Actually “insane” would be a better choice. This is what happens when you put Central Planners who have little if any real world experience, in charge of an economy. You spend millions of dollars to create low paying jobs.
And the Fed’s argument is to do this until unemployment falls.
The fact that the Fed continues to engage in QE despite its clear failure to create jobs indicates the Fed literally is either totally clueless OR is engaging in QE for other reasons.
My view… it’s a bit of both. The Fed is largely comprised of academics like Bernanke who have little if any experience in banking (interesting that he’s in charge of the Central bank since he NEVER worked in a bank in his life) or the private sector.
Indeed, even the pro-Wall Street crowd at the Fed (Dudley and Evans) don’t see how their policies are crushing the banking sector. Citigroup plans to lay off 11,000. JP Morgan is laying off 14,000. Morgan Stanley is laying off 1,600.
And yet the Evans and Dudley keep asking for more QE!
Buckle up… this won’t end well.
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