The Federal Reserve tried stimulating the economy with an easy money policy; there are less restrictions and regulations on money and its supply. So basically they printed of a bunch of money to try help get the economy going again, however things are backfiring on them. By this "quantitative easing," they were hoping to help out the unemployment rate which is just a couple tenths away from being 10%. The Fed also went on a "bond buying spree" to encourage economic activity such as investing and spending. However, unemployment remains unchanged and interest rates are climbing up. The Fed decided then to "flood the system with money" but the possibility of significant inflation worries many. The area of the economy that absolutely needs to be fixed in order for everything else to go smoothly is the housing market. Bad mortgages have got people stuck in a rut.
http://www.msnbc.msn.com/id/40643129/ns/business-eye_on_the_economy/
To be brutally honest, I know I could never be an economist or a politician or just anyone in control of figuring out how to fix the economy. There are so many factors involved when trying to fix the economy as a whole that by just focusing on one thing, you hurt another. An example of this I noticed in the article was that by buying back so many bonds in order to reduce economic recovery time, it didn't do anything to help the unemployment rate. Furthermore, I agree with the article when it says that as long as the housing market remains in the dumps, the economy isn't going to do much better. It almost seems to me as if the Fed should just take a step back and try look at things in a different way because all these "old" ideas aren't helping us so much.
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