Welcome, welcome to One Minute Crypto!
I’m your host, Chronos, and today, the US
Federal Reserve Bank announced a new asset
purchase program, starting next week.
Although they refuse to call the activity
“Quantitative Easing,” it has same net effect
on the market.
This plan will bring newly-created dollars
from the central bank into the US money supply.
Let’s go right to the source.
According to a statement from the New York
Fed, “…the Desk plans to purchase Treasury
bills at an initial pace of approximately
$60 billion per month.”
That’s $60 billion new dollars created per
month, out of nothing.
This comes after an announcement last month
from the European Central Bank to run their
own asset purchases in the amount of 20 billion
Euros per month, starting November 1.
Again, this is effectively the creation of
20 billion Euros, in an attempt to stimulate
the economy and increase inflation rates that
continue to run below target levels.
Inflation in the Euro area has run near 1%
annually over the past three months, while
the US dollar sits at about 1.7% over that
same time period.
Both central banks have a mandate to keep
inflation close to 2% over the medium term.
In the meantime, bitcoin users are unaffected.
Thanks for watching!