Gridlock, Fed Taper Say Keynesian Experiment Ending

[Geee]

Investors Business Daily:

Monetary Policy: So, the Federal Reserve has finally announced it will begin the long-awaited "taper" of its $85-billion-a-month purchases of U.S. government Treasury and mortgage debt. It's about time.

 

The U.S. central bank has been in crisis mode for five years, even as the White House continues to tout how well Obamanomics has worked.

 

Given the utter recklessness of the Democrat-driven, regulation-heavy, tax-and-spend fiscal policies that have hamstrung our economy, Ben Bernanke's Fed in 2009 stepped in with its quantitative easing program.

 

The problem with QE always was: How do you end a program that has pushed $85 billion in new money into the economy each and every month without dragging the economy and markets down at the same time?

 

The Fed hopes the answer is: Do it slowly. To that end, it announced Wednesday plans to cut $10 billion off its monthly Treasury and mortgage security purchases, lowering the total QE amount to $75 billion a month.