Sept. 13, 2012, Fairfax, VA—Americans for Limited Government President Bill Wilson today issued the following statement responding to the Federal Reserve's action to increase its holdings of mortgage-backed securities by $40 billion a month, or at an annualized pace of $480 billion a year:
"The fact that the Fed is acting a few short weeks before the election is outrageous. At best, it indicates they are willing to risk attacks on the central bank's independence due to the appearance of being political, revealing just how bad the Obama economy really is. At worst, they are desperately trying to juice markets to change the outcome in November. Neither is good.
"Bernanke has fired his last bullet. Since August 2007 when the crisis began, the Fed has increased its balance sheet from $897 billion to $2.865 trillion today, more than tripling it. The federal funds rate has been at near-zero percent since December 2008—all with little to no effect. It could not prevent the market downturn. It has not restored sustainable economic growth. Unemployment is still unacceptably high. If the last $2 trillion of monetary expansion and easy money did not cure markets or restore robust growth, what makes the Fed think another $480 billion will do the trick?
"Never has so much been done to so little effect. At least, not since Japan did precisely the same thing in the 1990s and 2000s. Just one more exclamation point that Obama's economy is adrift with no wind in its sails."
Americans for Limited Government is a non-partisan, nationwide network committed to advancing free market reforms, private property rights and core American liberties. For more information on ALG please call us at 703-383-0880 or visit our website at www.GetLiberty.org.