from Zero Hedge
Two days ago, when we noted that according to a recent research report by a top Fed economist, the US economy would need another $3.5 trillion in QE to offset the Fed’s inability to cut rates below zero, we said that this would be the academic strawman used by Fed members to justify trial baloons of much bigger QE (which is need if for no other reason, then to monetize the trillions in new debt issuance in coming years).
We didn’t have long to wait to see this in action, and on Friday morning, Chicago Fed President Charles Evans said that the Fed would ramp up QE if the recovery were slower:
“If things were somewhat worse, if the recovery was slower, I think we’d still be having interest rates at the zero lower bound, but I think we would also be following it up with more asset purchases and hoping that there would be more fiscal support as well.”