Fed announces extension of bond-buying stimulus program

[jaxx]

Fed extends Twist program with $267B more to drive long-term rates down, notes weaker hiring

By Associated Press, Updated: Wednesday, June 20, 11:40 AM

WASHINGTON — The Federal Reserve is extending a program intended to further lower long-term interest rates, noting hiring has weakened, consumer spending is rising more slowly and the economy needs more support.

The Fed will continue Operation Twist through the end of the year. The Fed has been selling $400 billion in short-term Treasurys since September and buying longer-term Treasurys. It says it will shift another $267 billion through December. The Fed wants to spur more borrowing, spending and growth.

http://www.washingtonpost.com/business/m...story.html

Too bad they can't build bridges and roads and put people to work without the freakin congress.

[sandnsea]

I think they're going about this totally backwards. If they want to spur borrowing, they need to start raising interest rates to force people to borrow before the rates go higher. The rates have been so low for so long that people don't feel any sense of urgency to make those long term loans, make big business improvements that need loans, etc.