Thursday, March 19, 2009

Quantitative Easing

This post relates to the following Keystone Economic Principles:
3. All choices have consequences.
4. Economic systems influence choices.
5. Incentives produce “predictable” responses.

Given the decision of the Federal Reserve to purchase long-term bonds, you might be looking for a resource to explain quantitative easing.

There's a good graphic on the subject at the Financial Times website (HT to Greg Mankiw). The site seems to be a bit fussy (sometimes I've had no trouble getting to it, other times it wants me to subscribe). I hope you can get to it and that it's useful. It's quite good.

I look forward to your comments.

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