Fed’s Inflationary Easy-Money Policy Hammered

Posted by Hans Bader

In a blistering attack, the Wall Street Journal today criticized the Federal Reserve’s inflationary easy-money policy, which aims to bail out mortgage borrowers through low interest rates, but caused the dollar to collapse in value against foreign currencies: “The dollar plunge has translated into a net transfer of trillions in wealth from the U.S. to the rest of the world. The result has been the largest decline in America’s global economic influence since the 1970s.”  The Fed’s policy has also been condemned by international investors and economists, like investment bank Julius Baer, which criticized the Fed for spawning an “Age of Decadence,” ”by allowing asset bubbles to form unfettered; by maintaining ultra-lax monetary policies; . . . and, by succumbing easily to the faintest political pressure.”

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06/05/2008 @ 12:04 pm | Economic Liberty, International, Precaution & Risk | Comments

One Response to “Fed’s Inflationary Easy-Money Policy Hammered”

  1. Posted by: Will Tax Increases Cause Capital Flight? | OpenMarket.org - 07/03/2008

    [...] economy also faces other risk factors, such as short-sighted federal policies designed to prop up overextended borrowers.  Those policies may also be reducing the flow of investment in the U.S., in addition to costing [...]

  2. Posted by: Will Tax Increases Cause Capital Flight? | OpenMarket.org - 07/03/2008

    [...] economy also faces other risk factors, such as short-sighted federal policies designed to prop up overextended borrowers.  Those policies may also be reducing the flow of investment in the U.S., in addition to costing [...]

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