U.S. President Barack Obama has selected liberal economist Janet Yellen to replace Ben Bernanke as chairman of the Federal Reserve – the secretive central bank that’s been printing trillions of dollars in a futile attempt to revive the flagging American economy.
Yellen – the deputy chief of the Fed – is viewed a Bernanke disciple, and is widely expected to continue his policy of “quantitative easing” (a.k.a. the creation of new assets out of thin air).
The first round of quantitative easing, known as “QE1,” took place from November 25, 2008 through March 31, 2010. Over that period, the Federal Reserve added $1.7 trillion to its balance sheet ($300 billion in Treasuries, $1.2 trillion in mortgage backed securities and $175 billion in agency bonds). The second round, dubbed “QE2,” took place from November 3, 2010 through July 1, 2011. Over that period, the Fed added $600 billion in Treasuries to its balance sheet.
And of course last September, the Fed began its latest and greatest round of money printing – an open-ended $85 billion a month commitment.
What has all this money-printing done to “stimulate” the economy?
Good question … a record 90.5 million people aren’t working, wages are flat and spending is down.
But hey … let’s just keep the printing presses running and hope for the best, right?
Believe it or not, Yellen may actually be more of a big government interventionist than Bernanke – who was originally nominated by George W. Bush and renominated by Obama. In fact she’s swung wildly to the left after being a supporter of tighter monetary policy under the reign of former Fed chairman Alan Greenspan.
One economist recently referred to Bernanke’s policy as the “biggest redistribution of wealth from the middle class and the poor to the rich ever.”
So … what does Yellen’s appointment mean for you? Well, if you’re a member of the American middle class it’s not going to be good.
“The US is about to have a Fed chairman who will continue doing much more of the same: pillaging the middle class, and injecting trillions in ‘wealth effects’ straight into the offshore bank accounts of the uberwealthy,” the website Zero Hedge notes.
Awesome! In other words if you’re not this guy (or one of his bailout buddies), now might be a good time to grab your ankles.