Post image for Fed purchases $600 billion in treasure securities to boost economy

Fed purchases $600 billion in treasure securities to boost economy

by Adam Russett on November 5, 2010

Though Greece was at the center of the recession in Europe, chairman of the Federal Reserve Ben Bernanke is attempting to avoid the mistakes made by Japan by purchasing $600 billion in treasury securities in an effort to stimulate the economy. The New York Times reports that the most recent move by the Fed reverberated across the globe and stocks in Asia and Europe rose on Thursday.

Bernanke's actions aim to prevent the economic issues facing Japan, where deflation has made it difficult to for the economy to grow. However, Republican critics believe Bernanke should focus on reducing the debt, which is what plagued Greece last year.

Though his policies have earned him critics, Bernanke has steadfastly defended his actions. In an op-ed piece in the Washington Post earlier this week, he argued that the results of lowering interest rates and buying trillions in failed mortgages helped put an end to the economic plummet. Still, despite the large steps taken to get the American economy back to where it was before the recession, experts are not convinced it will be enough to get the job done.

"Virtually everything on the fiscal policy side will be off the table in the deadlocked partisan world we face in 2011 and 2012," economist Robert J. Gordon told the Times. "This greatly increases the probability of a Japanese-style lost decade that would span the decade 2007-17."

The Bureau of Labor statistics reports that the United States added 151,000 jobs in October – the first time it has done so since May. However, in spite of the job growth, the unemployment rate stayed steady at 9.6 percent.

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