Current Monetary Policy Helping or Hurting? Essay

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Current Monetary Policy Helping or Hurting? Rosa L. Hernandez Post University Table of Contents Introduction – Interest Rates 1 Interest Rates (cont.) 2 Quantitative easing, inflation and price stability 3-4 Unemployment 5 Unemployment (cont.) & Conclusion 6 1 Although the opinions of various economists vary drastically in either direction, in my opinion the current monetary policy that the Federal Reserve System is pursuing is absolutely not helping our economy. The statutory objectives for monetary policy established by The Congress in the Federal Reserve Act are as follows; maximum employment, stable prices, and moderate long-term interest rates. I believe that currently the monetary policies in place are not meeting any of these needs. I would like to proceed with various details I feel will undeniably support and illustrate my opinion. For the last few years The Federal Reserve has been implementing “easy-money” policies. These policies push down both long-term interest rates, and short-term. On Thursday July 11th 2013 The Federal Reserve promised to continue to keep interest rates low until unemployment rates get closer to where they were prior to the “banking crash” of 2009. (Inman, 2013) For some of us low interest rates can be extremely beneficial, but there are some downsides. I will begin by highlighting the benefits of low interest rates, since it would be unfair and biased to simply point out the negative aspects. If you are on the borrowing side of low-interest rates, than you are on the winning side. The record low rates have increased the financing power for individuals. It’s much more affordable to finance a home, a car, an education and any other tangible goods and/or intangible services when interest rates are lower. I have personally benefited from lower interest rates since I purchased my

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