Bernanke: Obama Spending Costing US 2 Million Jobs

( – promoted by Rob “EaBo Clipper” Eno)

Well, actually Ben did not put it in those terms.  But add up what the Fed has been saying about QE2 with the projected $1.6 trillion FFY 2012 deficit projection and that’s the only conclusion that you can come to.

Chairman Bernanke forecasts that QE2–Quantitative Easing Part 2: the purchase of $600 billion in Treasuries by the Fed–will result in the creation of 700,000 jobs.  Yes, really.  Here’s the coverage from the USA Today:   http://www.usatoday.com/money/…  

The theory behind QE2 is that when the Fed buys treasuries on the open market and puts them on its balance sheet, that drives interest rates down.  Bernanke made the claim that the reduction in interest rates as a result of the most recent $600 billion of bond buying will lead to the creation of 700,000 jobs over the next two years.

So what if the $1.6 trillion of Treasury paper that Obama plans to issue the coming year were not issued.  http://www.washingtonpost.com/…  Presumably, that would have the same effect as $1.6 trillion in quantitative easing on bond markets.  

And the effect on jobs?  By Chairman Bernanke’s estimates, Obama’s spending spree is costing the US economy  1.9 million jobs over the next two years (that’s 1.6 trillion is deficit spending / $600 billion from QE2 times the 700,000 jobs from QE2).

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