raghu: > QE2 *could* have been stimulative if the Fed bought new T-bonds > directly from Treasury and paid for them with printed money, which the > Treasury could spend. But the Fed did not do that.
I still remember how I once lost control when Julio made an uninformed statement and insulted him, which I regretted a lot later. This time, I will be more careful. Let me tell you this: apart from minor details, there is no difference. Fed is still paying for them with "printed money", that is, by borrowing from itself! What the Fed is doing is synthetically replicating direct lending to Treasury. This is what financial engineering is about: if you cannot do it the right way, you still do it the right way, but disguise what you are doing. No attack or insult is intended, raghu. Best, Sabri _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
