Published on Activist Post, by Michael Snyder, September 15, 2012.
Ready or not, QE3 is here, and the long-term effects of this reckless money printing by the Federal Reserve are going to be absolutely nightmarish. The Federal Reserve is hoping that buying $40 billion worth of mortgage-backed securities per month will spur more lending and more economic activity. But that didn’t happen with either QE1 or QE2. Both times the banks just sat on most of the extra money.
As I pointed out the other day, U.S. banks are already sitting on $1.6 trillion in excess reserves. So will pumping them up with more cash suddenly make them decide to start lending? Of course not. In addition, QE3 is not likely to produce many additional jobs. As I showed in a previous article, the employment level did not jump up as a result of either QE1 or QE2. So why will this time be different?
But what did happen under both QE1 and QE2 is that a lot of the money ended up pumping up the financial markets. So once again we should see stock prices go up (at least in the short term) and commodities such as gold, silver, food and oil should also rise. But that also means that average American families will be paying more for the basic necessities that they buy on a regular basis. The most dangerous aspect of QE3, however, is what it is going to do to the U.S. dollar … //
… The following are 10 shocking quotes about what QE3 is going to do to America: … (full text).
QE3 – as disambiguation on en.wikipedia, leads to: QE1, QE2, and QE3: The expression “QE2″ became a “ubiquitous nickname” in 2010, usually used to refer to a second round of quantitative easing by central banks in the United States. Retrospectively, the round of quantitative easing preceding QE2 may be called “QE1″. Similarly, “QE3″ refers to the third round of quantitative easing involving the purchase of mortgage-backed securities, announced in September 2012, following QE …
Quantitative easing: Quantitative easing (QE) is an unconventional monetary policy used by central banks to stimulate the national economy when conventional monetary policy has become ineffective. A central bank implements quantitative easing by buying financial assets from commercial banks and other private institutions with newly created money, in order to inject a pre-determined quantity of money into the economy. This is distinguished from the more usual policy of buying or selling government bonds to keep market interest rates at a specified target value. Quantitative easing increases the excess reserves of the banks, and raises the prices of the financial assets bought, which lowers their yield … (full text on en.wikipedia);
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