Sunday, October 31, 2010

Fed decision to throw money into economy has critics

This week, a new stimulus package of asset purchases by the Fed is scheduled to be announced in an attempt to stimulate the economy. However, there are many economists who are saying that this is a bad idea and that there are going to be serious repercussions if the expected plan goes through. Some of the things economists point to as possible negatives are an asset bubble, high inflation, and a trading war stemming from the weakened US dollar. These are assuming the stimulus works, but many think that it won't even play a difference and is a waste of money. It's tough to help the economy and get approval from economists, there seem to be no foolproof way for successful stimulus.

1 comment:

Jack McCormick said...

I agree that the quantitative easing was definitely necessary, but there has to be a limit to much money is printed. Perhaps it would help if the uncertainty about upcoming regulations was dealt with, so to better increase the confidence of money loaners and potentially investors.