Fed: Fire Up the Printers, Baby!

QE 2 is coming! That would be Quantitative Easing to you peasants out there (who will bear the brunt of the Fed's missteps. Eat Cake! Peasants). Having tried QE 1 (and succeeded for a short time), the Fed is going to fire up the printing presses and fix the problem for once and for...going to fix the problem for...a short time anyway, before that gasoline burns itself out and we are in an even worse mess. Then we'll try QE 3, etc. etc. If you want to know how this will end find the free ebook Fiat Money Inflation in France and read it. That pretty much sums up where things will end, since this has been tried (and failed) before.

I particularly love this quote from the brilliant Christina Romer, who, frighteningly enough used to be the White House economic adviser:

"There's a lot of questions about quantitative easing and how it works and how communications policies work, but they need to be tried because this is still a crisis," she said.

In other words, we have no idea what will happen, whether or not it will make things better or worse, but we need to try something. (And if, in the process, it destroys you peasants and ten or twenty third world countries with 25% unemployment, so be it, at least our bankers and hedge fund operators will still be able to summer in the Hamptons).

Fire up the press, Mr. Bernanke. Get the helicopters ready to dump money everywhere!