A majority of Americans lack confidence in the Federal Reserve to adhere to its mandate to control inflation, a Rasmussen Reports survey finds.
The Fed recently announced plans to roll out a third round of quantitative easing, under which the U.S. central bank will buy $40 billion in mortgage-backed securities a month from banks on an open-ended basis, pumping the economy full of liquidity to push down interest rates and encourage investing and hiring.
The move follows two previous rounds of quantitative easing, under which the Fed bought a combined $2.3 trillion in assets from banks since the 2008 financial crisis.
Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation
Critics say such accommodative monetary policies plant the seeds for inflation down the road, and a recent Rasmussen Reports survey finds most Americans agree with them.
The survey found that 37 percent of the American adults polled are at least somewhat confident that the Fed can keep inflation under control and interest rates down, with just 11 percent are very confident.
However, 58 percent said they lacked confidence in the Fed, with 15 percent saying they were not at all confident.
“Prior to this year, confidence in the Fed was mainly in the high 30s since July 2009. Optimism inched up slightly in December 2011 and has hovered around 40 percent since then,” the survey found.
“But confidence dipped back down below 40 percent for the first time two months ago and has yet to climb back.”
The Fed bases its monetary policy decisions on a target for 2 percent inflation.
Fed Chairman Ben Bernanke said at a press conference upon announcing a third round of quantitative easing that he might be comfortable tolerating high inflation rates on a temporary basis.
“If inflation goes above the target level, as we talk about in our statement in January, we take a balanced approach,” Bernanke said, according to Reuters.
“We bring inflation back to the target over time, but we do it in a way that takes into account the deviations of both of our objectives [maximum employment and price stability] from their targets.”
Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation
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