They're winging it.
In a talk before a Harvard Club audience, Fisher presented a candid assessment about all the levers the Fed has been pulling in the aftermath of the 2008 financial crisis. And that includes the recently announced QE3.
"Nobody really knows what will work to get the economy back on course. And nobody-in fact, no central bank anywhere on the planet-has the experience of successfully navigating a return home from the place in which we now find ourselves. No central bank-not, at least, the Federal Reserve-has ever been on this cruise before."
I don't know about you, but the idea that four years and trillions of dollars into this quantitative easing voyage we're still sailing without a compass isn't just appalling.
Yet this ship of fools sails on.
The problem is, Fisher is right: QE3 won't work. QE1 and QE2 didn't fix this mess. Nor will QE4, QE5, onwards to infinity.
What's more, there's a cottage industry of pundits and consultants who'll agree.
Trouble is, just like Fisher and his colleagues at the Fed, none of them can tell you why it won't work.
That's what we're going to do here today.
We'll start by giving you the lowdown on how this nation's central bankers view "Quantitative Easing." Then we'll show you how the Fed thinks QE is supposed to work.
Finally, we'll punch some (actually, many) holes in in the Fed's hull by discussing why it's not working.
We'll even demonstrate what could still be done to fix this wretched mess.