Problem is those things cut rates, they don’t ‘inject credit’ or alter net financial assets held by the non government sectors.
It’s about price, not quantity.
Fed Wrestles Over How to Inject Credit Into Economy
by Steve Matthews
Mar 18 (Bloomberg) — Fed officials will debate how to provide further stimulus to the economy, from purchasing more mortgage bonds to buying Treasury securities, and will also keep the benchmark interest rate as low as zero percent, according to economist projections. At least three of the 17 top Fed officials want to buy Treasuries or target the supply of money, while Chairman Ben S. Bernanke has favored reviving specific credit markets. Policy makers have disagreed on just how to be more aggressive. They have at least three options: increase the $1 trillion Term Asset-Backed Securities Loan Facility aimed at restoring consumer and business lending; expand purchases of mortgage-backed securities and agency securities; or begin purchasing long-term Treasuries.
[top]