posted on Feb, 11 2018 @ 03:49 AM
a reply to: Whodathunkdatcheese
What happens in a state of excessive liquidity? Inflation.
What's the feds target rate for inflation? 3%
How does the fed target that rate (what methods are employed)? Open market operations (QE, Twist, etc.), reserve requirements, and the discount
ETA: To be fair and accurate, QE1 was meant for liquidity (to bring back to normal levels), beyond that was inflation targeting.
11-2-2018 by Dfairlite because: (no reason given)