As a little jolt to the stock market, the Federal Reserve today announced another round of quantitative easing (printing money) in an effort to reverse the rise in unemployment and encourage more home buying. This announcement arrives as the violence is still unfolding in Egypt and Libya among other Middle Eastern countries.

Report from The San Francisco Chronicle:

The Federal Reserve said it will expand its holdings of long-term securities with open-ended purchases of $40 billion of mortgage debt a month in a third round of quantitative easing as it seeks to boost growth and reduce unemployment.

“We’re looking for ongoing, sustained improvement in the labor market,” Chairman Ben S. Bernanke said in his press conference today in Washington following the conclusion of a two-day meeting of the Federal Open Market Committee. “There’s not a specific number we have in mind. What we’ve seen in the last six months isn’t it.”

Stocks jumped, sending benchmark indexes to the highest levels since 2007, as the Fed said it will continue buying assets, undertake additional purchases and employ other policy tools as appropriate “if the outlook for the labor market does not improve substantially.”

Bernanke is enlarging his supply of unconventional tools to attack unemployment stuck above 8 percent since February 2009, a situation he called a “grave concern.” The decision immediately provoked a renewed backlash from Republicans, including Senator Bob Corker of Tennessee, who said Bernanke’s policies damage the Fed’s credibility while doing little to spur the economy.

The Romney campaign condemned this new round if quantitative easing, report from MarketWatch:

Shortly after the Fed announced it would purchase $40 billion in mortgage-backed securities each month, Romney campaign policy director Lanhee Chen said in a press release: “The Federal Reserve’s announcement of a third round of quantitative easing is further confirmation that President Obama’s policies have not worked. After four years of stagnant growth, falling incomes, rising costs and persistently high unemployment, the American economy doesn’t need more artificial and ineffective measures. We should be creating wealth, not printing dollars.”

Most Americans are not paying attention to this type of dull economic news but this is the kind of under-the-radar story which has a great affect on our economy.

24 COMMENTS

  1. END the Federal Reserve — or let us just belly up to the International Banksters controlling them, and declare our Nation officially OWNED!

  2. Here is the solution for our troubles to be over:

    Bring the Troops Home, stop all undeclared Wars and Foreign Aid (Israel can protect itself), shut down the alphabet soup of unconstitutional Government Agencies that have sprung up (like the TSA and many more), End the Federal Reserve and peg the US Dollar to its original Gold Standard.

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  3. Curious:

    I have been surprised that we haven’t heard the typical chorus that this is a political move to help the incumbent. During an election year, if the Fed does anything at all, whichever party out-of-power goes ballistic about it.

    Have I just missed it, or do Republicans consider the Fed “theirs,” and therefore, not a target?

  4. Nate,

    I’d really like to see a better explanation of Quantitative Easing than “printing money” because it is quite different from the normal way the Fed prints money.

    If you remember any of my posts you’ll know that I’m pro-Paul and anti-Fed, but I’m not nearly as anti-Fed as much as some of the other Paulites around here. Over the last few years I learned more about how the Fed works and actually because less opposed to it … in principle. I’m concerned more about where the money goes once it’s printed than the fact it was printed in the first place.

    All profits of the Federal Reserve are returned to the US Treasury (minus overhead). So in theory, all the money that’s printed goes to the American people in the form of less need for taxes. And in fact the Fed does write a big check to the Treasury every year. But I suspect the check isn’t as large as it should be and that’s why we need to audit them.

    So the Fed loans a bank $1B then as the bank repays the loan the Fed forwards the money to the government minus 6%. That’s not so bad. I can live with that as long as the Fed is doing that job with integrity. When the Fed lowers rates for the banks it also lowers rates for you and me.

    But QE is a different beast altogether. The Fed is buying assets at more than market value. For example, a bank has a set of assets worth $500M and the Fed pays them $1B for those assets.

    There’s a huge difference between loaning a bank $500M and giving a bank $500M. And 99% of the population doesn’t even know that is what’s happening.

    • Ryan:

      Very thoughtful post. Thank you.

      As soon as I heard that the Fed was buying mortgage-based instruments, it sounded as if we are once again bailing out the bastards who cause all our problems in the first place.

  5. It’s a tax, doesn’t matter if you send them a check and they take it out of your bank account or they print money making you saving worth less the impact is the same. Something Romney was famous for, no tax increases but hiked up fees for every government service most of which were required for the average citizen to just exist from day to day. Printing worthless papar is a tax.

    • Look at it this way. You have 15 shares of a stock and the stock splits 2:1. Your shares are now worth half, but as long as they give you 15 more shares everything is fair. It’s not a tax. If they give you anything less than 15 shares, then it’s a tax.

      Quantitative Easing is most certainly a tax. When the Fed loans money it may or may not be a tax depending on the terms of the loan. (If the loan is at market value and the Fed returns all of the money, the only tax is the Fed’s overhead.) Unfortunately we don’t know what the Fed is doing and thus we don’t if and/or how much they are taxing us.

      But why split the stock in the first place? I won’t go into the reasons, but sometimes it’s advantageous. Likewise, it’s probably advantageous to keep a low, steady rate of inflation, and thus we need to increase the money supply to make that happen. As long as every dollar created means we all pay one less dollar in taxes, then everything is fair, similar to a stock split.

      And that’s why we need better education on this issue. As long as 99% of people have no idea what it is, the Fed can use a fancy name like Quantitative Easing and no one cares. Unfortunately our government thinks we’re better off if we’re kept in the dark.

      • I think we had the dark ages once before. Lasted about 500 years until the people got smart. 1913-2012 ? ? ? We got a ways to go.

  6. How the Central Banks (the International Jews and their patsies) STOLE our Free Nation and turned it into a Money Pit — where, We, The People, have become their economic SLAVES!

    Recommended reading — “None Dare Call it Conspiracy” Copyright © 1971 by Gary Allen with Larry Abraham ISBN: 0899666612 & “The International Jew” by Henry Ford (read his ORIGINAL writings from the 1920’s)!
    ——————————————————–

    Some key points from this video: (http://www.youtube.com/watch?v=lsmbWBpnCNk&feature=player_embedded)
    ———————————————————

    “The decrease in purchasing power incurred by holders of money due to inflation imparts gains to the issuers of money.”

    St. Louis Federal Reserve Bank, Review, Nov. 1975, p.22

    (minute 22:48)
    ———————————————————

    “The entire world economy rests on the consumer; if he ever stops spending money he doesn’t have on things he doesn’t need, we are done for.”

    (minute 26:22)
    ———————————————————–

    “With the monetary we have now, the careful saving of a lifetime can be wiped out in an eyeblink.”

    (minute 27:27)
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    “When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes. Money has no motherland; financiers are without patriotism and without decency; their sole object is gain.”

    Napoleon Bonaparte

    (minute 29:30)
    ——————————————————–

    *This has to be the BEST QUOTE VALID for ALL the World that wants FREEDOM and Prosperity — few other can compare to the verity of this one!*

    “I wouldn’t go to war again as I have done to protect some lousy investment of the bankers. There are only two things we should fight for. One is the defense of our homes and the other is the Bill of Rights. War for any other reason is simply a racket.”

    Major General Smedley Butler USMC (1881-1940)
    —————————————————–

    Usury is the norm — the creation of more money from the same amount of money, without the effort of the usurer (now days called Bank LENDER) to produce anything of intrinsic worth.

    (minute 32:51)
    —————————————————

    STUNNING MATH — at 10% interest the Money-Lenders will own ALL REAL Money in 50 years!

    (minute 33:12)
    ———————————————–

    US Dollar has lost over 96% of its value in the last 100 years! How far will it still sink…and does it really matter…since it’s so close to Zero now?!

    (minute 45:51)
    ——————————————————

    Summation of Banksters FRAUD — minute 58:40-101:40

    Shows the exact MO of the International Jews owning the Banks that enslave US!
    ——————————————————-

    At minute 104:05 — the comments are NO LONGER VALID (goes into “virtual” dollar)…thus not respective of the gold standard that needs to be reinstated to save US from economic collapse!

    Gold’s intrinsic value has validity, since it is of a specified limited quantity (being all nearly mined) — while Paper Money can be reproduced by the growth and cutting of many trees, nearly forever!

    “Electronic” Dollars — are just a a venue for a further Big Brother Dictatorship!
    —————————————————

    We need to return to the Original US Dollars (Silver and Gold CERTIFICATES) — the ones guaranteeing that the Dollar Amount on these US Treasury Bills (not some worthless “Promissory Federal Reserve Notes”) are BACKED and PAYABLE IN SILVER (OR GOLD) BY ANY US BANK UPON THE BEARER’S DEMAND!!!

    This is the only TRUE TEST of the VALIDITY of ANY Real Paper Money!!!
    ———————————————————

    minute 108:20 — gets back on track, showing the dead-end Banksters are holding US economic hostages with our government’s approval!
    —————————————————–

    at minute 111:01 — fails for the Second Time by stating the IDIOCY that Nationalized Banking is NEEDED (to solve the problem of Usury)! Then goes on to some other options, such as Localized Community Banking. Neither are valid options if printed Money is not pegged to a Gold Standard!
    ——————————————————-

    Ends sarcastically with the Taxman (the armed IRS goon) pointing a gun at the working people: “We are only doing this to save you. Remember that!”
    ——————————————————-

    Spread it!

  7. Write in Ron Paul for 2012 President is online!

    Vote and spread it like wildfire!

    http://writeinron2012.com/writeinBlog/about-us/

    —————————————————–

    A vote on principles is much better than a No Vote — and a trillion times better than voting for what one perceives as the “lesser of two evils”!

    My take:

    This election has been reduced again to voting for the “lesser of two evils” (but which one is the “lesser”?).
    ——————————————————-

    All indicators point that Rmoney is the CHOSEN ONE by the NY and London Banks (the International Banksters that control the Federal Reserve) and by Israel.

    Since their goals are directly opposite to the well-being of our Nation, by deduction this Bought-And-Paid-For-Mitt-Mutton-Puppet MUST NOT win!

    [[Should Rmoney win — expect the US to start an all out war against Iran to protect Israel from a possible single atomic bomb being developed in…10 years from now…? (certainly not to protect the US from such silly and nonthreatening remote eventuality) within a week of this creature taking office.

    What’s even more worrisome, is this Creature’s Control of the GOP (forcing a fraudulent “Aye” vote at the RNC convention), thus assuring It won’t be opposed to win a 2nd term!

    Eight years of Mutton-Mitt will mean a COMPLETE AND TOTAL DESTRUCTION OF THE USA — when wars will be started at a drop of an Israeli Hat (sorry, meant to say: yamaka), when the US Constitution will become null-and-void, when the US Dollar will finally become utterly worthless, by a phone call from his Banker Masters (who’ll call in their chips).]]
    ———————————————————-

    On the other-hand — the BO Creature will have 4 more years to further plunge us into Socialism and suck us dry through more taxation and further devaluation of the US Dollar and the attempted destruction of our Constitutional Rights.

    This creature will, however, be hampered by some republican wins in both Houses, thus having most of its venomous teeth pulled during its 2nd term.

    [[However, should the BO see itself not as a clear winner, it will assure its reelection by attacking Iran with two weeks to go (mid-to-late October) — since a “patriotic” War always guarantees the “Commander-and-Chief” a sure win!]]
    ——————————————————

    Conclusion:

    Either subhuman will get us into never ending wars and ever closer to loss of All Liberty, All Prosperity and the eventual Total End of Our Nation as Free People!

    For which “lesser evil” will you vote, now?
    ——————————————————

    I, for one (and my family and friends) will not be party to such infamy! If either of these Horrible Creatures wins, at least we’ll have a clear conscience that we did not compromise our principles by acknowledging their existence in the voting booths!

    We will vote our Conscience — Writing In Dr. Ron Paul!

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