Larry Summers’ Former Henchman Advocates More Money Printing

Bradford DeLong was the latest economist to advocate that the Federal Reserve launch a third round of quantitative easing, QE3.

Following yesterday’s release of the Fed minutes, DeLong – a professor at the University of California, Berkeley – said in a Bloomberg interview that “I don’t see any argument against QE3.  The worry is always that it will destabilize inflation expectations, that they’ll lose their anchor, and yet when you look out as far as you can at the prices of the TIPS and of the 30-year Treasuries, you see no sign at all that there’s been any loss of confidence that the Fed will keep inflation under control.”

According to the Berkeley professor, QE3 would increase construction, create jobs and help stimulate the economy.

Unfortunately, it should come as no shock that DeLong – who served as Deputy Assistant Secretary of the Treasury under Larry Summers during the Clinton administration – is a proponent of further money printing.

Despite the fact that QE1 and QE2 have not led to sustainable improvements in employment and have led to higher inflation around the world through rising food and energy prices, DeLong appears to think doing more of the same will somehow work.  If that is not enough, he clearly has not learned from the tremendous mistakes made by Japan in its efforts to fight deflation over the past two decades.

It is extremely disappointing that an individual with his credentials and ability to teach and influence the minds of America’s youth believes that solving a problem of excessive currency debasement and money printing can be achieved by doing more of what caused the problem in the first place.

Furthermore, for him to say that he does not see “any argument against QE3″ indicates just how predisposed many supposedly leading economists are to only considering one form of monetary policy, despite the many flaws and unintended consequences it has been shown to contain.