- Fred Civilian Unemployment Rate Consumer Price Index For All Urban Consumers All Items Fred Civilian Unemployment R 1 (162.53 KiB) Viewed 49 times
announced that the program would be expanded by an additional $750
billion in purchases of agency mortgage-backed securities (MBS) and
agency debt and $300 billion in purchases of Treasury
securities. On November 3, 2010, the Fed announced that it
would purchase $600 billion of longer-dated treasuries at $75
billion per month. The FOMC voted to expand its quantitative easing
program further on December 12, 2012. This round continued to
authorize up to $40 billion worth of agency mortgage-backed
securities per month and added $45 billion worth of longer-term
Treasury securities.
QUESTION: These FOMC’s unusually large-scale monetary expansions
are called quantitative easing (QE) 1, 2, and 3 respectively. Did
the QEs successfully achieve the Fed’s dual mandate that “stabilize
unemployment rate subject to keeping inflation low”? Why? Why
not? Justify your answer by the graphs.
FRED - Civilian Unemployment Rate - Consumer Price Index for All Urban Consumers: All Items FRED Civilian Unemployment Rate (left), Consumer Price Index for All Urban Consumers: All Items (bottom), Sep 2007 Sep 2017 12.5 11 10 10.0 9 7.5 B 5.0 Percent Percent. Percent Change from Year Ago of Index 1982-1984=100) 7 6 5 0.0 2008 -2.5 2010 2012 2014 2016 Source: U.S. Bureau of Labor Statistics fred.stlouisfed.org myf.red/g/fryw Panel (A). Line Plots for Unemployment rate and annual growth rate of CPI FRED M1 Money Stock, Jun 2009=100 Monetary Base: Total, Jun 2009=100 260 Percent Change from Year Ago of Index 1982-1984-100) Source: U.S. Bureau of Labor Statistics fred.stlouisfed.org myf.red/g/frzi Panel (B). Scatterplot for Unemployment rate and annual growth rate of CPI FRED -Currency in Circulation, Jun 2009=100/Total Checkable Deposits, Jun 2009=100 - Excess Reserves of Depository Institutions, Jun 2009=100/Total Checkable Deposits, Jun 2009-100 240 2.0 220 1.B 200 1.6 180 1.4 А. 160 1.2 Index 140 Index/Index 1.0 120 0.B 100 0.6 80 0.4 60 0.2 40 0.0 2008 2010 2012 2014 2016 2008 2010 2012 2014 2016 Sources: Board of Governors, St. Louis Fed fred.stlouisfed.org myf.red/g/frzk Source: Board of Governors of the Federal Reserve System (US) fred.stlouisfed.org myf.red/g/frzi Panel (C). Line Plots for M1 money supply and the Fed's monetary base Panel (D). Line plots for Currency ratio and Excess Reserve ratio