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Unformatted text preview: of inflation”.(Mauldin). To act against the Recession the Federal Reserve also had an idea to buy trillions of dollars of government debt so that more money could be injected into the economy increasing inflation, an idea that is called Quantitative Easing. Quantitative Easing would lower treasury yields, increase GDP, and higher employment. As a result people would by more and also invest more because the borrowing cost will be lower. But Bernanke has said that we will not face deflation many times yet we still are. The problem is that the Federal Reserve focuses too much on the short term instead of the long term solutions. Mauldin, John. "The Fed Pushes On A String As It Ponders How To Create Inflation - Intelligent Investing - Ideas from Forbes Investor Team - Forbes." Forbes . Sept.-Oct. 2010. Web. 30 Sept. 2010. <http://blogs.forbes.com/investor/2010/09/27/the-fed-pushes-on-a-string-as-it-ponders-how-to-create-inflation/>....
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This note was uploaded on 03/26/2011 for the course ECON 0146010010 taught by Professor Allisonfranzese during the Spring '11 term at Rutgers.
- Spring '11