The U.S. monetary base has doubled to $1.7 trillion (US) since September, a consequence of the Federal Reserve flooding financial markets with liquidity to head off a collapse of the financial system. This startling jump has many observers worried about inflation taking off. Some even think the magnitude of the financial crisis ...

Beware of the bursting of the bond bubble, says legendary hedge fund investor, George Soros, in a recent interview. The Fed’s massive expansion of the monetary base will be hard to reverse, he asserts. “The moment this fear of deflation turns into a fear of inflation, you'll find interest rates ...

It’s a little disquieting to see the S&P 500 sell off by 5% when an $800-billion stimulus package clears the U.S. Senate and Treasury Secretary Timothy Geithner announces a new rescue plan for banks, homeowners, and the economy. Investors’ confidence in policy makers has ebbed again, and if the loss ...

A recent 11,000-word article in the New Yorker on Ben Bernanke and the financial crisis describes the Federal Reserve chairman as “soft-spoken” and “incredibly quiet,” with a “retiring manner.” His work as an academic at Princeton University is portrayed as “statistics-laden” and “couched in impenetrable technical language.” His doctoral thesis ...

Let’s Volckerize the Fed. That’s the catchy title of a breakingviews.com piece by Martin Hutchinson on the need to stop the Federal Reserve from putting the world economy through a succession of credit binges and increasingly excruciating hangovers.

Why the Federal Reserve’s cut to 1% rate will fall short, according to a Financial Times of London editorial: 

Buy-and-hold and other investors may be getting a tad anxious about the parallels increasingly being drawn between the current financial crisis and the one some 75 years ago that spawned the Great Depression of the 1930s. Indeed, if history repeats, it could be another 25 years (or similarly long period) ...

The imperative to shore up the banking system explains why predictions of Fed rate hikes may be off the mark – even if inflation continues to rise. Financial stability is a higher priority, so rates need to be held low to allow hard-hit banks to recapitalize (as noted in my ...

U.S. banks are finding it difficult to raise capital and avoid a drastic restriction in lending, fanning fears of systemic meltdown and a plunge into a severe economic downturn. But maybe things aren’t all that bad: the Federal Reserve’s 2% discount rate is another avenue by which the banks ...

Many commentators think the Federal Reserve's dramatic rate cuts are flooding the world with liquidity and the consequence will be acceleration in inflation and debasement of the U.S. dollar. Bernanke is flying his helicopter over the U.S. dropping off bundles of freshly printed money, to paraphase a common refrain. So ...