Community | November 14, 2010 | 26 comments

Obama: Federal Reserve $600 Billion Stimulus Not Designed to Weaken Dollar

source: http://www.google.com/hostednews/ap/article/ALeqM5hio2kFj3ZKSbi8zx21awQSmLUAZA?docId=120b2d4...

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taking his ground in the global fight over the world's major currencies, President Barack Obama on Friday disputed claims that the U.S. was deliberately weakening the dollar while accusing China of manipulating its yuan.

Obama said the decision by the Federal Reserve to pump $600 billion into the U.S. economy was designed to give a boost to a slow recovery and address fears of deflation. Germany and other members of the Group of 20 of the largest economies meeting here this week have complained that the infusion of cash will devalue the dollar and hurt their exports to the United States.

The Fed operates independently from the executive branch and Obama has been careful to avoid interfering in its actions. But he broke from his policy of not commenting on the Fed decision to respond to those complaints.

"From everything I can see, this decision was not one designed to have an impact on the currency on the dollar, it was designed to grow the economy," Obama said at a news conference following the G-20 summit.

He added: "There was some concern that we had very low inflation, that a huge danger in the United states is deflation and that we have to be mindful of those dangers going forward."

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26 comments // Obama: Federal Reserve $600 Billion Stimulus Not Designed to Weaken Dollar

  • CarlosIsDown
    • 0
      CarlosIsDown  

    • The Fed is buying Mortgage Backed Securities. It's different than just printing money and throwing it out the window. At least that's why my Econ300 professor told our class.

      Not a big government guy whatsoever. He said the first days of class that the Government can't stimulate the economy. He's pretty much in so many words said that any govt intervention is bad (minimum wage, taxes etc).

      He is a believer in Backing Monetary Theory. He admits that everyone else is a Quantity Monetary Theorist.

      This is why I aint no econ major. According to him, before the recession hit, there was 800 billion in the money supply. After that, the fed increased it to 2 Trillion two years ago. Backing it was Govt Bonds. There was no resulting inflation.

    • 2 years ago
  • Sparky2U
  • TheEmpireGuy
  • Ihatethemall
  • FtheBULLSHT
  • Ihatethemall
  • FtheBULLSHT
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