Investors expect them to continue

The Federal Reserve is in over its head. It is trying to solve a fiscal policy created by feckless, cowardly politicians. Monetary policy cannot solve this problem. For a while it was able to cover it up somewhat. That point has been passed.

Today, the Fed will make another announcement. There is little question that they will try to juice markets and the economy in some form or another. For them to announce that they are done would collapse markets and eventually the fiscal policies that cannot be supported without the continuous printing of money. That is why markets and investors expect them to continue.

Surely there must be some constraint on this behavior other than hyperinflation? David DeGraw argues there is:

There are many factors that clearly demonstrate why it would be disastrous for the Federal Reserve to repeat their vicious Quantitative Easing (QE) policy. If you want to know a significant reason why they cannot get away with another round of QE, here is an equation for you:

(Quantitative Easing + Extreme Weather = Revolution + World War III)

From the very beginning we knew that the Federal Reserve’s QE program was going to cause the cost of food to rise and the dollar to decline in value, and that these intended results would lead to an increase in poverty and civil unrest. Now there is a new study that gives us some more proof of this obvious fact…

Mr. DeGraw, in his article, cites a couple of studies to buttress his case.

Suppose DeGraw is correct, do you believe the Fed will discontinue its economic meddling?

I think not and provided the rationale why in Political Parisitology and Kevorkian Economics. All the political class in this country has left is Federal Reserve “bread and circuses.” Even if the politicians  knew it was leading to WW III, they would continue their behavior in order to extend their time in office. Stopping the Fed means an economic collapse and a wholesale removal of political vermin from office in 2012. Staying in office is all that matters to these parasites. Damn the other consequences. Full speed ahead.