Fed Paper Finds Links Between Bond Buying, ‘Operation Twist’
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The Federal Reserve’s $600 billion bond-purchase program may be yielding results like those of a Kennedy-era effort to spur growth, which spawned a 0.15 percentage point reduction in long-term Treasury yields, said researchers at the central bank.
Economists with the Fed’s regional bank in San Francisco likened “Operation Twist,” a 1961 initiative by the central bank and President John F. Kennedy’s administration, to the current round of Treasury-securities purchases known as “QE2.” The researchers drew the comparison in a paper released today, without quantifying QE2’s effects.