Friday, 14 September 2012

Is Bernanke's QE3 a last desperate attempt to prove his theories right?

Apparently Romney is no fan of Bernanke's monetary policy referring to the QE3 stimulus plan as just a "sugar high" (see here). Another article suggests some conservatives worry Bernanke's latest actions could re-elect Obama (see here).

One could also speculate that Bernanke, in a last desperate attempt, commenced QE3 simply to artificially stimulate the economy short-term (i.e. the stock and bond markets), at the cost of the long-term, so he potentially could show to some improvement in the economy before he steps down. Which could be towards the end of this year. The Fed's "independence" could work in many adverse ways, and Bernanke can also, with his nearly unlimited and unpoliced power, do almost anything he wants to in a desperate attempt to prove his theories (whatever they are) and his ego right that he can indeed get the economy back on track. Bernanke has, at least he probably thinks he has, a reputation to maintain, at least towards the ones that do not really understand the damage the Fed has done over the years. More so than ever under Bernanke can quite easily be argued. 

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