September 1, 2012
POINTS AND FIGURES: Why QE3? Because Bernanke Says 25 Million Unemployed is a Tragedy. Ben Bernanke channeling Clint Eastwood? Why not? But there’s only one problem: “There is no benefit to quantitative ease except you feel richer than you really are. When looking at the costs, the Fed also needs to total up all the damage that it has wreaked on retirees that are living on a fixed income. Most of them have investments tied to an interest rate instrument and have been devastated by Fed action over the past several years. The other people that are hurt are savers. People sitting on cash in checking and savings accounts. Their cash suddenly got worth less than it was yesterday.”
Yeah, somebody was talking about that the other day.
Bottom line: “The Fed is out of bullets. The only thing that can stimulate this economy is a change in fiscal policy.” But where are we going to get that?