12-01-2008, 12:58 PM | #1 |
Member
Join Date: Jan 2006
Location: SLC
Posts: 441
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Printing money...
The Fed's been (fairly quietly) snapping up toxic securities in exchange for cash, above & beyond the $700B given to Paulson. Their balance sheet has swollen from ~$700B to around $2.2T. Essentially, the Fed is using the power granted to it by Congress to create & distribute money, something typically done very judiciously, if at all.
A popular, cynical explanation is Paulson & Bernanke are mostly looking out for their banker buddies. Or are they peering at a potential spiral & taking some pretty drastic measures to avoid it? Given how the Great Depression started out as a nasty downturn and turned into a spiral, is this justified? |
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