{"id":44698,"date":"2019-03-23T09:43:35","date_gmt":"2019-03-23T14:43:35","guid":{"rendered":"https:\/\/olduvai.ca\/?p=44698"},"modified":"2019-03-23T09:43:38","modified_gmt":"2019-03-23T14:43:38","slug":"the-fed-has-given-up-get-ready-for-more-qe","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=44698","title":{"rendered":"The Fed Has Given Up: Get Ready for More QE"},"content":{"rendered":"\n

The Fed Has Given Up: Get Ready for More QE<\/a><\/h3>\n\n\n\n

The Federal Reserve’s Federal Open Market Committee on Wednesday voted unanimously<\/a> to keep the federal funds rate unchanged. Overall, the FOMC signaled it has made a dovish turn away from the promised normalization of monetary policy which the Fed has promised will be implemented “some day” for a decade. Although the Fed began to slowly raise rates in late 2016 \u2014 after nearly a decade of near-zero rates \u2014 the target rate never returned to even three percent, and thus remains well below what would have been a more normal rate of the sort seen prior to the 2008 financial crisis.<\/p>\n\n\n\n

\"ank3.jpg\"\/<\/a><\/figure>\n\n\n\n

Much of the Fed’s continued reluctance to upset the easy-money apple cart comes from growing concerns over the strength of the economy. Although job growth numbers have been high in recent years \u2014 and this has been assumed to be proof of a robust economy \u2014 other indicators point toward less strength. Workforce participation numbers, wage growth, net worth numbers, auto-loan delinquencies and other indicators suggest many Americans are in a more precarious position than headlines might suggest.<\/p>\n\n\n\n

The Fed’s refusal to follow through on raising rates, however, has highlighted this economic weakness, and today’s front-page headline in the Wall Street Journal<\/em> reads: “Growth Fears to Keep Fed on Hold”<\/p>\n\n\n\n

Abandoning Plans to Reduce the Balance Sheet<\/h4>\n\n\n\n

For similar reasons, the Fed has also signaled it won’t be doing much about it’s enormous balance sheet which ballooned to over four trillion dollars in the wake of the financial crisis. Faced with enormous amounts of unwanted assets such as mortgage-backed securities, the Fed began buying up these assets both to prop up \u2014 and bail out \u2014 banks and to produce an artificially high price for debt of all sort.<\/p>\n\n\n\n

 \u2026click on the above link to read the rest of the article\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"

The Fed Has Given Up: Get Ready for More QE The Federal Reserve’s Federal Open Market Committee on Wednesday voted unanimously to keep the federal funds rate unchanged. Overall, the FOMC signaled it has made a dovish turn away from the promised normalization of monetary policy which the Fed has promised will be implemented “some day” for […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[303,4512,661],"class_list":["post-44698","post","type-post","status-publish","format-standard","hentry","category-economics","tag-fed","tag-fomc","tag-qe"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/44698","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=44698"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/44698\/revisions"}],"predecessor-version":[{"id":44699,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/44698\/revisions\/44699"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=44698"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=44698"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=44698"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}