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The End of the Fed Stimulus Program: A Reality Check
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The End of the Fed Stimulus Program: A Reality Check

Knowledge at Wharton·@HashtagPLUS·about 1 month ago
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As the U.S. Federal Reserve last month ended its two-year stimulus, or “quantitative easing” (QE), program of buying mortgage-backed securities from banks and institutions, a rash of concerns arose about the future of the economy. Expectations must be realistic about the impact of the Fed’s actions, according to Wharton finance professor Krista Schwarz , whose current research work is on quantitative easing. She noted the objectives set for the Federal Reserve by the U.S. Congress — “maximum employment, stable prices and moderate long-term interest rates.” However, the Fed’s powers have been described as “a very blunt tool” to affect the economy, she noted. “It is the equivalent of donating to a large charity versus going into a soup kitchen and doling out the meals yourself,” she said, speaking on the Knowledge at Wharton show on Wharton Business Radio on SiriusXM channel 111 .…

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