Ron Paul End the Fed: 4 Reasons Why QE3 From Bernanke Would Wreck the EconomySubmitted by DeMolay on Sat, 09/08/2012 - 15:55
Now that the convention circuses are finally over, the highly anticipated August jobs report was released yesterday with less than optimistic numbers. According to the Labor Department, nonfarm payrolls increased by only 96,000 in August, significantly lower than the 140,000 needed to put any dent in the unemployment rate.
These sluggish employment numbers were seized upon by Governor Romney and the Republicans to attack the president, but even more predictably, have been used to justify calls for more action by the Federal Reserve to help stimulate the economy. "The economy is crawling up the down escalator and today's report can only give ammunition to the activist members of the Fed board to loosen monetary policy further next week," said Patrick O'Keefe, head of economic research at J.H. Cohn in Roseland, New Jersey.
In other words, QE3. Especially in the midst of election season, a short-term boom from a Fed "monetary injection" is politically tempting and very likely as the economy continues to struggle. But another round of quantitative easing is the last thing that is needed for economic recovery and growth, and here are four consequences that would result from QE3.