When QE2 Weighs Anchor

摘要

The Federal Reserve's program of buying up bonds is scheduled to end in June. What will that do to the economy and interest rates - and your portfolio? AS GOVERNMENT agencies go, few have a bigger influence, of course, than the Federal Reserve, whose policies affect the prices of everything from a 30-year mortgage to a double skim latte, not to mention the outlook for economic growth, jobs and inflation. So when Federal Reserve Chairman Ben Bernanke signaled last year that the Fed would buy as much as $600 billion in Treasury bonds, it was bound to make waves - among Fed fans and critics alike. But now that the central bank's bond-buying binge is drawing to a close, even some of the Fed's toughest critics are nervous. The program - which policy wonks call quantitative easing, but nearly everyone else calls QE2 - was designed to keep bond prices high and interest rates low. It is credited with propping up the economy and, in turn, boosting the stock market. Technically, the Fed is in the midst of its second round of bond buying - hence the 2 - since the financial crisis struck in 2008. When the first round ended in spring 2010, both stocks and bonds tumbled.