Will the Federal Reserve Move to Help the Economy?
The Federal reserve is wrapping up a two-day meeting, and Wall Street is anxiously awaiting what comes out of the gathering.
The importance of this outcome may drive stocks up or down, because many expect Chairman Ben Bernanke to make a new announcement about new stimulative steps by the Fed to boost the economy. Some speculate they may try to add new liquidity into the system, in essence, printing more money.
Economist Maury Randall at Rider University says that would have a temporary benefit. But Randall says commodity markets would jump, and so would inflation.
For certain, the Federal Reserve has a limited reach as far as how much more they can do for the economy.
Randal points out that Congress and the President have the real power to deal with tax changes that will broadside many in the middle class by year’s end, and that’s where the real help needs to be.