Says We Need More of the Same at Fed

Fed night cc

As usual, the editorial fails to say why.

The Bloomberg editorial below says that the economy is doing so poorly that the Fed should reconsider its planned “tapering” of  new money creation.

You will notice that, once again, proponents of the Fed’s radical Keynesian policies just take for granted that they help a weak economy. In their minds, it is a given. There is no need to provide an explanation for why they help. Nor is there the slightest recognition that in fact these policies could be backfiring and causing unemployment.

There is the rub. There is no economic logic or evidence behind the idea that more money creation will reduce unemployment. More money creation may help hold up the stock market. But there is also no economic logic or evidence showing how a stock market bubble will help unemployment. Even Fed economists are beginning to acknowledge this.

Click here for the article.