The United States to be "quantitative easing" birth of a new asset bubbles

Some analysts pointed out that the quantitative easing policy of the second round of the most direct effect is pushing up asset prices, making investors feel the illusion of wealth back, and thus increase consumption and promote economic recovery. But in fact the feeling of speed of return of this wealth is much slower than the occurrence of an asset bubble, the current U.S. stock market and other major financial markets, asset prices have reached high prices if they can not quickly into the high income, then asset prices will be quick adjustment, and all efforts will be wasted.

A recent market survey showed that most people believe, even if the Fed to the end of this year bought 1 trillion national debt, GDP was only just pushed a little bit. If the new scale of quantitative easing is less than 300 billion U.S. dollars, its impact is almost negligible. Now according to the Fed rate of 75 billion U.S. dollars a month, asset prices may soon swallow these currencies.

Some economists that the Fed creates so much credit, and ultimately reach the real sector can not be converted into effective demand, since access to credit, liquidity of commercial banks will convert these excess reserves. When the first round of the quantitative easing have not created the credit runs out, how can we expect these new money to work?

Some commentators point out that the problem lies in the structure of the U.S. economy, excessive reliance on external borrowing to consumer need to change the mode of cheap products, "you lead a horse to the river, if it does not drink it, even if you give more water no use. "

　　Serious policy differences within the U.S.

Americans do not support the U.S. Federal Reserve launched a new round of quantitative easing, the differences are very serious. Supporters argue that the federal rate has been hovering at zero interest rates, leaving little room for the Fed action, "something is better than not doing anything." The opponents say that this deadly "prescription" itself than the U.S. economy is suffering from problems even worse.

Subtly, at a time when the just-concluded midterm elections, Republicans regained control of the House of Representatives, and increased the seats in the Senate. The two views quickly transformed into conservatism and Keynesian debate. Inspired by the Republican Party to win against the quantitative easing big government began to attack the Obama model of taxpayer money wasted, and mockery of the Federal Reserve is "the soldiers are in desperate foxholes, polishing a rifle bullet, out a pistol. If the call light pistol bullets, only with a knife, or even bare hands to deal with economic recession. "

Of the quantitative easing was originally a purely economic proposition that is so over-react, and let the Americans off guard.

Fairness, it did adopt a new dilemma of quantitative easing. Some people think that the Fed is nothing as good, the economy needs to recover from the bubble burst a long time, reallocation of resources mismatch takes time. Grow from the fundamental quantitative easing inflation, and inhibit consumption. In addition, the quantitative easing currency against the dollar, push up international oil prices directly and indirectly pushing up the prices of food and other necessities, causing instability.

Since there are so many negative effects, positive effects not obvious, it is difficult to understand why the Federal Reserve this time to introduce quantitative easing policy. United States, President of Euro Pacific Capital Peter Schiff recently in a commentary that said the Federal Reserve to deal with deflation, increasing employment and so on are used to divert attention of the "Red Herring", increasing its balance sheet to cover the United States Treasury bonds continued to decline in the financing ability. Coordinated with the U.S. government is the real purpose of quantitative easing, especially in the Democratic Party lost the midterm elections, Obama will need the government to implement any policy of 60 Senate votes in favor, difficult. The Fed's "independent" status can be detached out.