Misconceptions About Fed’s Bond Buying
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Sept. 3 (Bloomberg) -- To combat the recession that beganin 2007, the Federal Reserve and some other central banks havebeen buying large amounts of long-term bonds. The novelty ofthis quantitative easing makes the policy especially prone topopular misconceptions.
Misconception No. 1: QE bond purchases are comparable tostimulus spending on roads and tax cuts, which adds to thenational debt.