Fed may Hold Rates to tackle Job Losses

As all of you know that, Federal Reserve, USA Chairman Ben S Bernanke has printed US $ 1.3 Trillion US Dollars out of thin air only and pushed it into the world’s largest Economy.

In Normal Conditions, when US Government issue Treasury Debt, other countries of world such as India, China, Russia & Japan buy it. But this time Federal Reserve has issued Treasury Debt and Federal Government has bought it and in this way, US Government has printed Money in True Sense.

But here is the other concern. The concern is that, Now US Dollars are Terribly flowing Currency in the world and the Federal Lending rates are ground Zero to shoot up the economy. So there is a concern of Hyperinflation. Because if Bernanke fails to absorb this much amount of Liquidity back from the Economy, once the Economy bounce backs, it will literally cause Hyperinflation & Mass Financial Disaster in the world….

So to keep the interest rates at a record low, Bernanke may have to show Congress and Investors that he can be as creative about soaking up cash from the Financial System as he was when pouring it in.

Experts feel policy makers will need to keep rates unchanged a lot longer, perhaps until late 2011, to bring down unemployment.

Bernanke will outline his strategy for exiting biggest monetary expansion in history when he delivers his semiannual economic report to congress.