Quantitative Easing

I'm a little slow sometimes in catching up to what is going on in the economy.  The fact is, I don't pay that much attention to the news and most news coverage is of all the wrong things anyway.  The things that truly impact us tend to stay below the radar of most of the media.

Tonight a friend asked me what I thought about the Quantitative Easing Policy of the Fed.  It was a new term to me, so, I did some research.  At risk of being raked over the coals for doing so, I am going to link (here) to the Wikipedia definition.  Yeah, I know, there is definitely risk associated with using a Wikipedia definition, but, after a good deal of research of other sources I concluded that it does a pretty good job of explaining it.

I also am linking an MIT article that is another attempt at explaining it.  Interestingly, the conclusions of the two definitions are somewhat at odds.  The MIT article seems to think it will do no harm, the writer of the Wikipedia entry sees a good deal of risk.

I not only see risk, I see definite harm to the average citizen.  The impact of the policy is an increase of the money supply while forcing interest rates to artificially low levels.  The result is a deflated dollar.  That means that the average citizen is losing wealth because his money is worth less and he can't get a reasonable return on most investments that he would make.

The problems with the economy are not going to be fixed by Monetary Policy.  The real issue is uncertainty created by wrong-headed Fiscal Policy.  Until Congress and the current Administration get their house in order, the economy will remain stagnate.  While there is plenty of money in the system, no one is willing to risk it to create new jobs.  Banks aren't lending without Federal Guarantees and businesses aren't expanding in the face of huge tax increases on the horizon. 

The Season of Mud

The campaign rhetoric of the mid-terms is turning nasty as usual.  Such a turn is emblematic of our society in general.  We have come to tolerate incivility to the point there are few limits on behavior short of breaking the law.  That is frequently done as well because the consequences are usually light or non-existent except in the most heinous cases -- and then only if caught. 

It is also a manifestation of the loss of moral guidance.  In a society where people are taught that there is no ultimate moral law, how can we expect civil behavior?  The most vitriolic attacks seem to come from the left which is made up primarily of those who do not believe in God.  They may tell you they are Christian, or whatever, but, a lack of belief in God makes such a statement merely a political expedient.  I think that is the case of our "dear leader" in Washington.  Political pragmatism as the guiding principle for leadership means getting the job no matter what it takes (lying, back-stabbing, etc.) and then holding on to it by the same methods.

The American people need to learn to recognize such individuals for what they are -- power-hungry and morally bankrupt.  Sadly, it has become accepted by nearly all political aspirees that not responding in kind is a sign of weakness and a sure-fire way to lose.