The fed has (another) plan to save the economy. After Quantitative Easing 1.0 didn't work, and Quantitative Easing 2.0 failed, the Fed today rolled out Quantitative Easing 3.0, bigger and better than ever.
The Fed is going to spend up to $40 Billion per month to buy mortgages from U.S. banks. By giving those banks cash in exchange for the mortgages they currently hold the banks will suddenly be so flush with money that they'll loan to businesses so they can build factories and hire workers.
(Why didn't they think of this great idea at the beginning?)
Where does the Fed get $40 Billion every month for the foreseeable future? Easy! They print it.
I don't understand money stuff but I think the rule of thumb says that the more of something there is the less valuable it is. So what happens to the dollar if 40 billion of them are dumped into the economy every month? And how long does this continue before the Fed comes up with QE 4.0?
Yeah, I don't get it.
I also don't understand why businesses that are too skittish to make large capital outlays will suddenly feel so emboldened about the future that they'll go in to borrow those fresh new dollars.
I've waved the white flag, given up the fight, surrendered unconditionally.
When we bought this house the front "yard" was plain gravel with two overgrown succulents. Ugly. That first year I took all of that out, put in landscape quality gravel (it is, after all, the desert), created some mounds, and put in trees and plants. The two trees and three of the eight plants have done well. OK, they're still alive. The others have hovered near death and/or been replaced at least once.
I'm done. The rabbits have won.
The eat anything they can reach. The standard Sun City solution is to put a chicken wire fence around each Lantana, 'cause that's beautiful. Why dress the place up with landscape plants only to surround them with chicken wire? Might as well put a couch on the front porch.
The plants the rabbits don't eat (and therefore don't need chicken wire) they burrow under for their nests, killing the root system. The drip system keeps the desert ground moist and ideal for raising the next generation of little monsters.
So I pulled out the chicken wire and removed the plants that have already been killed. The others, the plants with a few tiny buds of green left on otherwise brown stems, I'm surrendering. Posted a DNR order. When they're finally gone I'll rake gravel over the top and say a blessing for the dearly departed.
Headed into town for a meeting right after dinner. Pam and I will get home about the same time. Tomorrow morning she leaves for Michigan.
Heavy sigh.
1 comment:
Most banks already have enough capital to loan out. They're commonly finding that those who are qualified to borrow money don't want to borrow right now or those that want to borrow money sent qualified at this time. Credit quality is so important for banks (scrutinized by regulators) that credit risks taken by banks are lower than before. Flood banks with cash by buying off high-risk mortgages and you'll have cash-strong banks sitting on more cash than they have now.
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