November 12, 2015
Federal Reserve Chair Janet Yellen
is stressing the need to review
the unconventional monetary policies that central banks
around the world deployed in response to the 2008 global
She said Thursday that the
post-crisis period offers policymakers an opportunity to
assess the effectiveness of the
tools and better understand the impact of new
"Policymakers have to carefully
weigh the advantages and disadvantages of alternative monetary
implementation frameworks in the presence of new policy tools,"
Yellen said in remarks at a two-day research conference
sponsored by the Fed.
We have no idea
what's going on, or whether or policies are helping or making things
Also today, St. Louis Fed Chairman
James Bullard said (via
Fed "may need to alter some fundamental assumptions about how
Fed policy works if U.S. stays in persistent state of low
nominal rates, low inflation."
But the most important thing Bullard
said in his speech titled "Permazero"
is that the the US may be entering a permanent period of lower
inflation and interest rates.
Wait, wasn't ZIRP and QE supposed to
push the US economy, boost inflation and hike rates? Good to
know 7 years later that the biggest monetary experiment in
history did precisely the opposite of what it was supposed to
We've noted for over
7 years that the Federal Reserve has
no idea what it's doing.
For many years, the world's most
prestigious financial institution, known as the "Central Banks'
Central Bank" - the
Bank for International Settlements - has
slammed the Fed's policies of:
Indeed, one the Fed's core tools -
quantitative easing - which is aimed at boosting inflation, may
Another core tool - creating a "wealth
effect" - actually
HARMS the broader economy in the long run.
Heck of a job …