As has been the case for months now, Federal Reserve officials continue to spend time in speeches justifying what it has done and putting off criticism, particularly of the idea of a moral hazard. The latter is a very real possibility, I think. Moreover, while many pundits believe the Fed did what it had to do, it’s important for investors to recognize that not everyone agrees with that. Frankly, given there is no control group, it will never be possible to confirm the Fed “saved” economy or not with certainty.

The Fed is hard at work pushing the efficacy of how its aggressive actions are in the country’s interest. The Fed’s original legal mandate is working for the maximum employment that is consistent with stable prices. Now that the Fed is the world’s central bank, it has taken upon itself the authority to heap on many more responsibilities.

Here’s what the Fed’s been saying. On Bloomberg TV, Fed Vice Chairman Richard Clarida said of the Fed’s huge lending programs: “It’s an ambitious and entirely appropriate and aggressive and forceful use of monetary policy in these times.” Meanwhile, Fed Reserve Bank of Chicago President Charles Evans said, “…the past month demonstrates that the Federal Reserve will use its tools aggressively to keep mark...

Unlock this article with a FREE 30-Day Trial!

An FSI Pro, or FSI Macro subscription is required in order to access this content.

*Free trial available only on a monthly plan

Disclosures (show)

Get invaluable analysis of the market and stocks. Cancel at any time. Start Free Trial

Articles Read 2/2

🎁 Unlock 1 extra article by joining our Community!

You’ve reached your limit of 2 free monthly articles. Please enter your email to unlock 1 more articles.

Already have an account? Sign In

Don't Miss Out
First Month Free