With U.S. unemployment at 8.1% the Federal Reserve is taking a big step to try and get the rate even lower.
The Fed will purchase mortgage bonds at a pace of $40 billion per month; this is what they are calling the QE3. Federal Reserve Chairman Ben Bernanke also wants to send interest rates even lower than their current historic lows. This is now the 3rd time the Fed has tried something like this. November 2008 QE1 began and was halted in June 2012. August 2010 was round 2 and we have now entered round 3 almost 2 years later from when QE2 began.
So will this actually work? According to economists QE1 prevented deep depression by Americans but QE2 had minimal effects so only time will tell if QE3 is actually worth it.
Our Spin Cycle debated the question. Check out what they had to say