The U.S. seems to learn nothing from Japan which has engaged in QE for the last 20 years.
We all know that this is not the end of QE; there will be further QE by the Fed.
From Market Watch:
The Federal Open Market Committee of the central bank said it would buy up to $600 billion in long-term Treasurys until the end of June 2011, including about $75 billion this month, in a strategy called quantitative easing. It also indicated it would spend roughly $35 billion a month reinvesting the proceeds of maturing mortgage-backed securities into government bonds.
This is the second time the Fed has engaged in quantitative easing, as it snapped up $1.7 trillion in mostly housing-related assets between December 2008 and March 2010.
The Fed purchases are designed to bring down yields on government bonds believing that lower rates could always give the recovery a boost.
More broadly, the Federal Reserve wants to prompt private businesses and investors to begin to act with more confidence and help get the economy’s juices flowing.
Doubts persist about whether the plan will work, but many feel the Fed had little choice but to act.
The Fed’s favorite policy tool, the target federal funds rate for interbank lending, has been about as low as it can go, in a range between zero and 0.25%, since December 2008.
http://www.marketwatch.com/story/fed-to-buy-600-billion-in-government-bonds-2010-11-03
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