4 ms·
I think the asset price inflation is a secondary benefit (and may help if it makes people feel wealthier and more likely to spend/invest). The main goal of the
by Tycho 5y ago
I think the asset price inflation is a secondary benefit (and may help if it makes people feel wealthier and more likely to spend/invest). The main goal of the Fed's asset purchases is to lower long term interest rates (they can only directly control short-term rates). This makes borrowing more affordable for everyone.
- bryanlarsen 5y agoThe main goal is to prevent a recession. They do this by encouraging spending. They encourage spending by making money cheaper. They make money cheaper by buying bonds using their money printer. This makes interest rates cheaper.