Fed addicts get another hit: More stimulus and low rates through mid-2015
America's top banker Fed Chairman Ben Bernanke gave the addicts Thursday what they desperately wanted – more cheap, easy money. We're talking about Quantitative Easing, or QE3, a tool used by central banks to stimulate the economy.
This is the 3rd time that the Fed has pulled the trigger on QE3. Today's hit is unprecedented because this time Ben's giving addicts what they want until the Fed is satisfied with our economic growth.
"What we're trying to convey here is that we're not going to be premature removing policy even after economy recovers." Bernanke said at his press conference, " Even after unemployment rate begins to move down more decisively we're not going to rush to begin to tighten policy."
Here is the Fed's Plan of Action:
- Purchase $40 billion a month of mortgage-back securities
- Keep short-term interest rates low through mid 2015
Could all of this stimulus eventually have a negative effective on the United States' economy?
As part of CNN's in-depth look at the issues that affect the 2012 election Jim Bianco, president of Bianco Research comes OutFront.
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