The goals of the Federal Reserve's policies are to promote economic recovery and to help ensure price stability, consistent with our mandate. I am less optimistic than some that additional asset purchases will have significant, durable benefits for the real economy. Of course, benefits may well be more substantial than I anticipate. Lower risk-free rates and higher equity prices--if sustained--could strengthen household and business balance sheets, and raise confidence in the strength of the economy. Modestly higher rates of inflation could increase nominal growth, and ostensibly place the economy on a stronger trajectory.
So let me get this straight, Warsh voted to counterfeit more US currency even though he does not believe it will have a material impact on the economy. So what is the point of QE 2, outside of higher stock prices? It is obvious that debt monetization is the plan despite what Fed officials claim. Furthermore, this speech shows the Fed realizes money printing does nothing to increase economic growth or reduce unemployment. It also confirms the Fed is fully aware of the dreaded consequences of QE 2: inflation which is an illegal confiscation of wealth, artificially low interest rates (new credit bubble), and a global currency war. No doubt this speech will serve as critical evidence in his future trial for treason and counterfeiting, along with his fellow accomplices on the FOMC.
The only good thing I can say about Warsh and his colleagues is that their kamikaze economics will soon bring down the illegal Federal Reserve once and for all. Unfortunately, they will have first destroyed the US and world economy. Unlike 1929-1930, the American public will know who is responsible.
Black Swan Insights
The fed chairmen has the QE'S.
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