Politics: QE3: Hey, let's try more of what's not working!
Published by: Herman Cain on Saturday September 15th, 2012
By HERMAN CAIN - Easy money doesn't do a thing when federal regulators are making banks afraid to lend.
I'll have more on this in my weekly commentary coming on Sunday, but I needed to say something now about this desperate move by the Federal Reserve to triple down on "quantitative easing."
Who told these people that, when a policy isn't working, the answer is to do more of it? Didn't Einstein say something about that?
QE1 and QE2 did not succeed at releasing money from Wall Street onto Main Street, and QE3 isn't going to do that either. One of the primary reasons is Dodd-Frank, which has big banks scared to death to make any sort of risky loan. Just because there's capital available doesn't mean banks will lend it when regulators are breathing down their necks telling them not to.
Don't tell that to the Fed, though. They're going full-speed ahead, printing $40 billion a month trying to kick-start the economy. And this time they say they'll do it endlessly until the economy improves. And what if QE3 never makes the economy improve, because QE3 isn't the answer in the first place? Well, it shouldn't be hard to find dollar bills sitting around, not that they'll be worth anything.
About that: The value of your dollars is going to deplete even further. This is called planned inflation. Ben Bernanke says not to worry, that he'll know when to stop, but he wasn't able to recognize that his last two rounds of QE accomplished nothing, so why should we be confident in his judgement about this? Do you like what you're paying for a gallon of gasoline now? One of the effects of more quantitative easing will be drive up the price of a barrel of oil, and you know what that means.
The Obama Administration has only one idea - central government planning by central bankers - and when that doesn't work (and of course it never works), the only idea they have is more of it.
We're not really going to keep these people in charge, are we?