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'''Quantitative Easing''' is the controversial use of gimmicks by the [[Federal Reserve]] to try to encourage economic growth during a recession.  It consists of buying up longer-term bonds in an indirect effort to lower medium and long-term interest rates. So, the Federal Reserve shift its portfolio of assests from overnight and short term loans to holding more long-term bonds.

'''Quantitative Easing''' is the controversial use of gimmicks by the [[Federal Reserve]] to try to encourage [[economic growth]] during a [[recession]].  It consists of buying up longer-term [[bonds]] in an indirect effort to lower medium and long-term [[interest rates]]. So, the Federal Reserve shifts its portfolio of [[asset]]s from overnight and short term [[loans]] to holding more long-term bonds.

It is an economic monetary policy in which the total money supply is increased by the [[Federal Reserve]] buying government Treasury bonds. The goal is to encourage private banks to lend more and help reduce the effects of an economic recession. Quantitative easing was first used by [[Japan]] in 2000 to fight a deflationary economy. The 2010 and 2011 actions of Federal Chairman [[Ben Bernanke]] is to buy U.S. government bonds, with borrowed money, to help ease America's declining financial statistics. By creating more dollars out of thin air, the dollar becomes devalued with the existing money supply versus other currencies. This policy of creating additional money to give to banks so that they lend more is highly questionable. The banks were largely responsible for the [[Great Recession]] and the increased money for banks have failed to produce the desired effect even after the Central Bank's $1.7 trillion purchase. The short term gains are minimal and in the long term, this will eventually lead to higher prices and inflation or even hyper-inflation. <ref>[http://blogs.forbes.com/charleskadlec/2011/02/22/higher-inflation-is-on-the-way/ Higher Inflation Is On The Way, Forbes.com, February 22, 2011]</ref>

It is an economic monetary policy in which the total money supply is increased by the [[Federal Reserve]] buying government Treasury bonds. The goal is to encourage private banks to lend more and help reduce the effects of an economic recession. Quantitative easing was first used by [[Japan]] in 2000 to fight a deflationary economy. The 2010 and 2011 actions of Federal Chairman [[Ben Bernanke]] is to buy U.S. government bonds, with borrowed money, to help ease America's declining financial statistics. By creating more dollars out of thin air, the dollar becomes devalued with the existing money supply versus other currencies. This policy of creating additional money to give to banks so that they lend more is highly questionable. The banks were largely responsible for the [[Great Recession]] and the increased money for banks have failed to produce the desired effect even after the Central Bank's $1.7 trillion purchase. The short term gains are minimal and in the long term, this will eventually lead to higher prices and inflation or even hyper-inflation. <ref>[http://blogs.forbes.com/charleskadlec/2011/02/22/higher-inflation-is-on-the-way/ Higher Inflation Is On The Way, Forbes.com, February 22, 2011]</ref>