Jon Hilsenrath wrote a good article for the Wall Street Journal describing remarks by Federal Reserve Chairman Ben Bernanke (“Bernanke Makes Case for Further Fed Moves to Boost Economy”). Bernanke believes that inflation is well contained and economic activity is weak justifying monetary easing (actions by the Fed Open Market Committee to increase economic activity). Bernanke suggested that the Fed might purchase long-term Treasury bonds to push down long-term interest rates. He also suggested that the Fed would proceed with caution because of uncertainty about the program’s effectiveness.
Let me reassert my belief that short-term policy instruments are not as effective as sometimes advertised and my belief that policy should focus on creating long-term growth.Replace this text with...
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1 year ago
Deficit spending must be brought under control for any possibility to stabilize the economy. The continued practice of doing whatever the administration wants with no regard for the future is taking us down a path of ruin. So much loanable funds are tied up in deficit spending that the small business is being crowded-out of the ability to obtain loans to expand. It is no wonder that unemployment has cycled to levels not seem in decades.The uncertainty of future tax policies cause companies to hold investment dollars rather than use that money to expand their businesses creating jobs for the citizens.
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