The Fed's "gamble" will once again affect the world's nerve

European financial network】 this "gamble", not only to the U.S. economy can recover, but involves the stable development of world economy, once the concern had become a reality, the consequences would be disastrous.

Fed lavish, is $ 600,000,000,000 threw! Under the watchful eyes, the Fed began to bet the world affects the nerves of a "gamble" in Beijing on Nov. 4 morning start.

2 to 3 November, the Federal Reserve monetary policy decision-making Federal Open Market Committee held a regular meeting of monetary policy decisions. In line with the market had expected the Fed at this meeting to restart the second round of quantitative easing in monetary policy, announced before the end of June 2011 to buy 600 billion U.S. dollars of U.S. Treasury bonds, to further stimulate the U.S. economic recovery.

Statement after the meeting, the Fed said it would phase in the subsequent months the implementation of the plan of the estimated 75 billion U.S. dollars a month to buy U.S. Treasury bonds; In addition, the Fed will continue due to balance sheet debt of the reinvestment of gold to buy government bonds existing policy. The Fed also announced the same day, the federal funds rate to 0.25% in the zero level of the same.

Although the implementation of 600 billion U.S. dollars every month a new quantitative easing monetary policy roughly in line with the projected 500 billion to 1 trillion U.S. dollars in the size and manner, but this "gamble" really opening, few countries able to calm the world "crowd."

Oil prices rose, food prices rose, sugar gone up ... ... Zhangshengyipian, looking ahead, the inflation tide has swept over most countries on earth. A few days ago, India, Australia and other countries has raised interest rates should, but the Fed's 600 billion U.S. dollars, "the bomb" to destroy the illusion of these countries to suppress inflation.

Analysts believe that the second round of the U.S. policy of quantitative easing would further create a lot of liquidity. By the low rate of return and the dollar and other factors, these funds contribute much in the U.S. bond market, and will not immediately flow to the U.S. real economy. Because money is the pursuit of profit, while the U.S. real economy is not much profit. The most likely flow to overseas, especially emerging market countries. The stampede of hot money will create new asset bubble, increase inflationary pressures in these countries. In addition, the excess liquidity will push up international commodity prices, a world-type inflation.

Some media reports, Federal Reserve Chairman Ben Bernanke as new initiatives to stimulate the U.S. economy, defense, and he said the decision would not cause unnecessary for future inflation. But the loud retort.

British "Financial Times" reported that the Fed's loose policy is a dangerous gamble, the potential benefits of small, but contains a significant risk of asset bubbles manufacturing, and these bubbles may undermine global economic stability. Despite the weak U.S. economy, the outlook is uncertain, but the quantitative easing is not the appropriate response.

U.S. evaluation of this policy is not optimistic. "Los Angeles Times" reported on November 4, many analysts believe the Fed's latest move will have limited effect. Once the U.S. economic growth accelerated and the unemployment rate decreased significantly, the Fed may not be able to fast enough to the injection of funds from the market, in which case inflation will soar.

"The New York Times" on November 3 citing economic consultant Leonard J. Santow as saying he worried that the Fed is wrong with the way monetary policy increased to deal with the United States in fiscal policy errors. The main problem lies in the United States, fiscal policy, the Fed chairman, the budget proposal to the Government and the recognition of monetary policy in stimulating economic growth in the United States has not much room there is nothing wrong.

In fact, these concerns and opposition from the foregoing, the Fed released back in to restart the quantitative easing monetary policy when the wind had been widespread, but the Fed did not give up this practice. Some analysts believe that the partition in the situation of the United States Congress, the U.S. fiscal policy will be hard work, so the task of stimulating economic recovery, the Fed had no choice but to play.