Now the Fed is artificially stimulating the economy by printing money at a rate the world has never seen.
By pegging nominal interest rates at artificially low levels, the Fed is penalizing millions of people who have their assets in saving accounts or money market funds and are getting near zero nominal returns.
Bonds are priced artificially (due to the Fed).
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Ballooning annual federal deficits have created artificial GDP growth which is being fueled by artificially low interest rates created by Fed policy.
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By artificially depressing interest rates, the Fed has enabled Obama and Congress to continue their insane overspending, while shafting citizens who depend on income from their savings.
Following the Keynesian playbook, the Fed has kept interest rates artificially low and is now on its third round of quantitative easing.
Interest rate fluctuation has worked to make money artificially cheap in certain periods since the Fed inherited total control of monetary policy in 1971 after the dollar was delinked from gold.
The use of the Fed to peg nominal interest rates at artificially low levels, fine tune the yield curve, incentivize risk taking, monetize government debt, and inflate selected asset prices by allocating credit are deviations from sound money and free markets.
Bernanke was completely unaware that the Fed actions had created an economy that had become completely addicted to artificially-produced low interest rates and inflation.
This is less important if you buy securities that are very liquid and have the Fed doing all it can to keep both short- and long-term rates artificially low.
Murphy and his crew at the Gold Anti-Trust Action Committee contend that the Fed, in collusion with other central banks, has been keeping the gold prices artificially low for about the past 15 years through manipulation of global reserves.
Artificially low in fact, as a result of Federal Reserve easing, QE and a near zero Fed Funds rate.
Interestingly, the new Fed-driven solution to high unemployment is to promote home purchases more aggressively than ever by artificially driving down mortgage rates.
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