“He’s hoping to cause new housing starts and put construction workers back to work.”
It’s hard for me to impugn something that is so lacking as Bernanke’s character. What he hopes for, and what will transpire, are two different things. What is already occurring is inflation in commodities. We can call that collateral damage to all the little people who don’t figure into the QE scheme. While we are waiting for the construction industry to fire back up, and for another housing boom to rally the economy with real money, there will be more people going under, contributing to the glut of unemployment and housing. At best, depending on your perspective of best, Bernanke’s latest QE will cause the stock market to rally, and maybe create enough growth on paper to give Obama bragging rights come November. You go on believing this is a good thing, spawned from good intentions and legal mandate. The debt crisis will still be here, worse than ever, when it is all over.
The Federal Reserve didn't cause the debt crisis. That's 100% Congress. The Federal Reserve didn't even own many gov't securities before 2008. And the crisis is 2008 was caused by the oil price spike which resulted in unemployment. The Unemployment caused mortgages to go bad and the two caused the banking crisis and credit freeze.
A lot of the commodity price increase you are seeing is due to oil, not Bernanke.
The debt crisis will indeed still be here when this is over. And this won't be over until Congress and/or the Executive wise up about trade and energy policies. But none of that is Bernanke's fault.
To the extent that we have inflation the debt crisis may be easier to deal with. But I don't think Bernanke would inflate for that reason. It's not his mandate, and he didn't before the 2008 crisis. And I'm not advocating that. I think he is responding soley to the unemployment as he should. But Bernanke is just first aid. Congress is cause and the cure.