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The risk of easy money

With the Federal Reserve’s recent move to make historically low interest rates even lower, debate is raging over the efficacy and advisability of such actions: Will easy money lower unemployment significantly or simply cause higher inflation?

Fed Chairman Ben Bernanke has said that while the Fed is doing all it can, monetary policy offers no simple solutions to our employment challenges. I’m not an economist, but I have spent time around thousands of small-business owners and investors, and I remain skeptical — despite the best intentions of the Fed — that even lower interest rates can make a meaningful dent in our unemployment problem. And while the risk of inflation is important, such low interest rates pose a more immediate problem for senior citizens and middle-class families who rely on savings.
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