With the growing national outcry over the Federal Reserve’s so-called “quantitative easing” (QE) scheme to enrich Wall Street by conjuring trillions of dollars into existence to prop up mega-banks, at least one former high-ranking official at the U.S. central bank issued a heartfelt public apology. Writing in the Wall Street Journal, Andrew Huszar, who managed the Fed’s $1.25 trillion mortgage-backed security buying spree until 2010, explained in detail how the deeply controversial plot served mostly to enrich big bankers and financiers — all at public expense.
“I can only say: I'm sorry, America,” Huszar wrote this week about his role in fleecing everyday Americans to shower the big banks with more loot. “The central bank continues to spin QE as a tool for helping Main Street. But I've come to recognize the program for what it really is: the greatest backdoor Wall Street bailout of all time.” The Fed’s marketing gimmicks used to make the heist seem palatable to the public — supposedly helping to keep cheap credit flowing to the American people amid the crisis — proved to be a bogus smokescreen used to conceal the real agenda.
Huszar, who has experience in banking and academia, had left his previous job at the Federal Reserve in early 2008 over frustration at the institution’s increasing submission to Wall Street. The next year, he was asked to come back, this time to manage the centerpiece of the Fed’s unprecedented bond-buying bonanza. He described the scheme as “a wild attempt to buy $1.25 trillion in mortgage bonds in 12 months.” It would represent the “largest” so-called economic “stimulus” plot in American history, Huszar noted, dwarfing the massive banker bailout approved by Congress that so enraged the public.
Pointing out that the Fed had never purchased a single mortgage bond in its close to a century of existence before QE, Huszar suddenly found himself overseeing an unprecedented scheme that was “constantly” putting confidence in key financial markets at risk around the world. “We were working feverishly to preserve the impression that the Fed knew what it was doing,” he argued, suggesting, implausibly, that the central bank’s leadership did not really understand the consequences of its reckless activities. Eventually, though, Huszar became suspicious again.
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