Stephen D. Williamson of the Federal Reserve Bank of St. Louis last month issued a study called "Current Federal Reserve Policy Under the Lens of Economic History: A Review Essay."
CNBC ran a good summation of it, and they point out something Williamson himself didn't really draw attention to while mostly writing off the past 7 years of quantitative easing as not accomplishing many of the central bank's own goals:
as for spurring inflation, reducing employment or otherwise generating sustained economic activity, the results, particularly for QE, are "at best best mixed." In addition to muted inflation, gross domestic product has yet to eclipse 2.5 percent for any calendar year during the recovery, while wage gains, and consequently living standards, have been mired around 2 percent or less. "There is no work, to my knowledge, that establishes a link from QE to the ultimate goals of the Fed—inflation and real economic activity."
But what might Federal Reserve policy have helped achieve?
The primary place where QE seems to have worked is in the stock market, where the S&P 500 has soared by 215 percent since the recession lows in March 2009. Elsewhere, though, deflation fears have permeated and interest rates have remained low.
Andrew Huszar, who managed a mortgage-backed security purchase program for the central bank, admitted it did more to prop up Wall Street then to help most Americans back in 2013:
Despite the Fed's rhetoric, my program wasn't helping to make credit any more accessible for the average American. The banks were only issuing fewer and fewer loans. More insidiously, whatever credit they were extending wasn't getting much cheaper. QE may have been driving down the wholesale cost for banks to make loans, but Wall Street was pocketing most of the extra cash….
See Reason's 2014 set of essays on why predicted inflation has not (yet) resulted from the Fed's years of QE-ing.
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