Fed to spend $40B a month on bond purchases

[morris14ccm]

http://news.yahoo.com/fed-spend-40b-mon ... 55641.html

WASHINGON (AP) — The Federal Reserve says it will spend $40 billion a month to purchase mortgaged-back securities because the economy is too weak to reduce high unemployment. The Fed says it will keep buying the securities until the job market shows substantial improvement.

The Fed also extended a plan to keep short-term interest rates at record-low levels through mid-2015. Both steps were announced after the Fed's two-day policy meeting.

The bond purchases are intended to lower long-term interest rates to spur borrowing and spending. The Fed has previously bought $2 trillion in Treasury bonds and mortgage-backed securities since the 2008 financial crisis.

Skeptics caution that further bond buying might provide little benefit. Rates are already near record lows. Critics also warn that more bond purchases raise the risk of higher inflation later.

Silver has spiked from about $32.81 to $34.04 in 10 minutes following this announcement.

[Kurr]

34.73 now!

Very exciting to see!

[slickeast]

How does buying mortgaged back securities going to help create jobs?

Send $40 B a month to every American 18 and over. Keep doing that and you would see a stimulated economy , job growth, and $20 gallons of milk.

[barrytrot]

I was thinking the same thing? Mortgage backed securities = jobs? Where? When? How?

Jobs would be created INSTANTLY as would self-sustaining income if the government just stopped needless intervention in commerce.

Still buying bonds is better than whatever else the Government planned to do is my bet.

[Sheikh_yer_Bu'Tay]

"Mortgage backed securities"??!!

So the Fed is buying (read putting US on the hook for) paper notes backed by more paper notes??!!

Isn't that the kind of stuff that got us into this mess to begin with???!!

They have lost their freaking minds!

'Scuse me, I just remembered I need to go buy more ammo.

[Copper Catcher]

[slickeast]

CC, you didn't post the pic of the people that are cutting a hole into the bottom of that lifeboat