File under BOHICA:
The Federal Reserve will spend $45 billion a month to sustain an aggressive drive to keep long-term interest rates low. And it set a goal of keeping a key short-term rate near zero until unemployment drops below 6.5 percent.
The policies are intended to help an economy that the Fed says is growing only modestly with 7.7 percent unemployment in November.
The Fed said in a statement issued Wednesday that it will direct the money into long-term Treasurys to replace an expiring bond-purchase program. The new purchases will expand its investment portfolio, which has reached nearly $3 trillion.
If this were to go on a year, that’s $540 billion worth of QE — or “money printing” as we used to say. That’s over $4,000 per household in the United States. And in the end we’ll be back right where we are (or worse)… with some inflation added for flavor.