Blaine’s Bulletin by U.S. Representative Blaine Luetkemeyer

This week, Ben Bernanke announced that the Federal Reserve would continue its misguided quest to ease our financial woes with purchases of $85 billion per month in mortgage-backed securities and Treasuries. This follows years of quantitative easing that have loosened our grip on sound monetary policy and created what many believe to be an artificial recovery.

What few in the Federal Reserve are discussing but what everyone else seems to understand is that continued quantitative easing comes with very real risks, including a dramatic increase in inflation rates, asset bubbles and long-term economic stagnation. Additionally, given the low rate of success that similar plans have had in other countries, it seems the Fed’s current program will pose significant dangers to the U.S. economy in the long run. Peter Schiff, chief executive office of Euro Pacific Capital, summed the situation up recently when he said: “After more than four years of never ending monetary stimulus and more than $5 trillion worth of new federal debt, the economy remains stuck in a serious recession.”

While many in Washington continue to focus on the economic crisis facing Europe, it is equally important to turn west and examine the eerie similarities between Japan’s monetary policy and our own.

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Posted on Tuesday, February 19, 2013 at 8:02 am