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Reader Selected News For Week Jun 15 – Jun 21

This thread is for the busy bees of S&L to post news articles that might not warrant their own thread.

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This article was posted by Steve on Friday, June 14th, 2013. Comments are currently closed.

20 Responses to “Reader Selected News For Week Jun 15 – Jun 21”

  1. canary says:

    Mosque, Boston Terrorists attended founded by convicted Terrorist Abdurahman Alamoudi was visited by Federal Law Enforcement to embrace and offer reach out.

    Glenn Beck: Rep. Gohmert drills FBI Director over incompetence in Boston Marathon Terrorists

    June 14th, 2013

    A House Judiciary Committee hearing got a little heated on Thursday when Rep. Louie Gohmert (R-TX) battled FBI Director Robert Mueller over the efficiency of the FBI’s investigation into the Boston Marathon bombers prior to the April 15th attack.

    Somehow, Mueller claims he was unaware that the mosque the Tsarnaev brothers attended, the Islamic Society of Boston, was founded by convicted supporter of terrorism Abdurahman Alamoudi.

    Glenn explained that the reason the exchange began was because the FBI purged all of the information on all of the mosques that had been collected.

    Watch the exchange here:

    Gohmert: “I want to go back to Boston. You said things like how — the FBI did an excellent job, a thorough job, …
    …The FBI never canvassed Boston mosques until four days after the April 15th attacks. If the Russians tell you that someone has been radicalized and you go check and see the mosques that they went to, then you get the articles of incorporation, as I have, for the group that created the Boston mosque where these Tsarnaevs attended and you find the name al-Amoudi, which you remember, because this man who was so helpful to the Clinton Administration with so many big things, he gets arrested at Dulles Airport by the FBI, and he’s now doing over 20 years for supporting terrorism. This is the guy that started the mosque where your Tsarnaevs were attending, and you didn’t even bother to check about the mosque….”

    Mueller: “We went to the mosque.”

    Gohmert: “Prior to Boston?”

    Mueller: “Prior to Boston. We were talking to Imams several months beforehand as part of our outreach efforts.”

    “Outreach efforts?” Really?

    Gohmert: “Were you aware those mosques were started by Abdurahman Alamoudi?”

    Mueller: “I answered the question, sir.”

    Gohmert: “You didn’t answer the question, were you award they were started by al-Amoudi?”

    Rep. Louis Gohmert joined Glenn later in the program to discuss the exchange he had with the FBI Director who claimed the congressman had his facts wrong.

    “Were not wrong,” Rep. Gohmert quickly asserted. “… And these mosques, from what I understand — and we want to drill down and find out more information — but there are other people that have been radicalized there….”

    Gohmert continued to explain that the “outreach” comment tracks back to a prior hearing where Mueller testified and kept responding to people that the Muslim communities are exactly like every other community in America and every other religious community in the country.

    “I said well, you said that, and didn’t then you talked about your outreach effort to the Muslim community and you have a specific part of the FBI that does outreach for the Muslim community, so I said, how are the outreach efforts for the Baptists and the Jews and the Buddhist, how are those groups doing?” the Congressman continued.

    “TheBlaze will do a week-long special this fall on Islamic radicals and we are going to name names and show all of this. We have nailed it down and we are going to show it all…,” Glenn said. “You need to see how it has happened and who is involved in both parties.”

    “Well, Louie, you have 70 people in Washington that are not willing to sit down on this and we are going to watch your back, at least I am,” Glenn responded. ”I begged for you guys to do it and now you are doing it.”

    (much more)

  2. GetBackJack says:

    9/11 Terrorists.

    9/11 – “We want to learn to fly the big airplane.”
    Flight School – “Okay, we can do that. We’ll teach you all the basics, takeoff, landing, inflight …”
    9/11 – “No takeoff, no landing. Just flying big plane.”
    FS – “Uh … what?”

    Lest anyone forget – http://www.wanttoknow.info/911/9-11_summary_articles/010923post_terrorist_flight_training

    • canary says:

      It left out that while the one flight school called the FBI to report the terrorist who failed flight school went to another and bribed him with money, the CIA would not grant a search warrant to get the terrorists computer.

      The survivors of 9/11 victims really did their homework and in a nutshell, Congress sugar coated that the two federal agencies needed to communicate with each better. I guess it’s just like on TV and the movies where law enforcement agencies to include local law enforcement just don’t like to cooperate.

      And this administration that has had more successful attacks such as Ft. Hood, Boston, underwear bomber, is too busy spying for political reasons watching tea parties and Republicans. When their not hanging out with prostitutes or clubbing with Hillary.

    • Mithrandir says:

      Every crisis is the excuse to increase government bureaucracy.

      If they are lucky enough to have a crisis fall into their lap, such as 911, Boston 2013, school shooting, all the better force through a big government agenda.

      And when it’s a slow news year or decade, they simply INVENT a crisis to solve, such as Global Warming, or if you are a child of the 70s, Global Freezing, or 80s, Acid Rain. There is always a crisis on the verge of getting “solved” or one about to be unleashed in which the government can justify more spending and bigger bureaucracy. But the whole point of it, just like African governments and starving kids, is to NEVER solve the crisis!

      The gas crisis got us the $20 billion / year Dept. of Energy. 911 got us the Dept. of Homeland Security, and the Dept. of Education doesn’t educate one child.

    • GetBackJack says:

      Ignore the bad guys. Focus all the intelligence gathering on potential voters in the 2014 mdi terms. Grapple with Big Data until a Plan becomes clear how to insure Republicans lose in the biggest repudiation ever. Take the House, Senate and Executive. Fully implement The Plan.

      Do Not Use Lube

      That about cover it?

      Remember Longshanks. “We’ll promise the Scottish Lords lands and titles.” (today’s bureaucrats)
      And Huey Long – Them what come in with me now, get a big piece of pie. Them what come in with me later get pie. Them what don’t come in with me will get Good Government.

      That’s my summation of our intelligence services turned inward.

  3. canary says:

    Another Al Qaeda Terrorist Org joins Syrian Rebels in their Righteous Quest for Democracy and Freedom in Overthrowing Secular Syrian Leader.

    More evidence the U.S. Arms and weapons will definitely end up in Al-Qaeda’s hands and more evidence Al-Qaeda is fighting their own civil war in Syria.

    Al-Qaeda Iraq arm leader rejects order to scrap Syria merger

    June 15, 2013 – 16:55 AMT

    PanARMENIAN.Net – The leader of al-Qaeda’s Iraq arm defiantly rejected an order from the terror network’s global command to scrap a merger with the organization’s Syria affiliate, according to a message purporting to be from him that was posted online Saturday, June 15, The Associated Press reported.

    In an audio message posted online, a speaker identified as al-Baghdadi insists that a merger he announced in April with Syria’s Jabhat al-Nusra rebel group to create a cross-border movement known as the Islamic State in Iraq and the Levant will continue.


  4. canary says:

    Syrian Rebels Pledge loyalty to Al-Qaeda

    Detroit Free Press – June 14 2013

    Obama to Syria: ‘Red line’ has been crossed
    Obama cautiously steps deeper into Syrian conflict by sending small arms

    BEIRUT — A Syrian rebel group’s April pledge of allegiance to al-Qaeda’s replacement for Osama bin Laden suggests that the terrorist group’s influence is not waning and that it may take a greater role in the Western-backed fight to topple Syrian President Bashar Assad.

    The pledge of allegiance by Syrian Jabhat al Nusra Front chief Abou Mohamad al-Joulani to al-Qaeda leader Sheik Ayman al-Zawahri was coupled with an announcement by the al-Qaeda affiliate in Iraq, the Islamic State of Iraq, that it would work with al Nusra as well.

    “They provided them early on with technical, military and financial support , especially when it came to setting up networks of foreign jihadis who were brought into Syria,” Bakri says. “There will certainly be greater coordination between the two groups.”

    The United States, which supports the overthrow of Assad, designated al Nusra a terrorist entity in December. The Obama administration has said it wants to support only those insurgent groups that are not terrorist organizations.

    Rebels not affiliated with al-Qaeda have pressed Washington for months to send weaponry that will allow them to match the heavy weapons of the Syrian army.

    “The rebels in Syria have one common enemy — Bashar Assad — and they will collaborate with any faction allowing them to topple his regime,” he said.

    He confirmed that al Nusra is generating loyalty in Aleppo, a region battling for months with Assad, by providing financial support as well as setting up charities.

    Zelin says some Syrian people have criticized al Nusra for banning alcohol, forcing women to wear a full veil and whipping men who are seen with women in public.

    “This illustrates the need for American leadership in the Syrian conflict, particularly with regard to helping non-Qaeda-aligned rebels contain the growth of (al Nusra) and similar groups,” he said.

    … Assad would use the announcement from al Nusra as evidence for his claim that he is fighting terrorists, not Syrian citizens who wish an end to his dictatorship, Mouhieddine said.

    [In this Jan. 11, 2013, file citizen journalism image provided by Edlib News Network, ENN, which has been authenticated based on its contents and other AP reporting, shows rebels from al-Qaida affiliated Jabhat al-Nusra waving their brigade flag on the top of a Syrian air force helicopter, at Taftanaz air base that was captured by the rebels, in Idlib province, northern Syria. / Edlib News Network ENN / Associated Press By Mona Alami]


    And there are other articles that Al-Qaeda provided the supposed chemicals of mass destruction.

    One can imagine how many Al-Qaeda men, women, and children, will look like abused and feverish refugees in order to come to the US.

    Al-Qaeda has been helping the rebels from the start two years ago, yet Obama only tells Syria’s leader to step down. And Russia may actually have been telling the truth the last two years that
    it is Al-Qaeda and terrorists trying to take over Syria. Can any leader be trusted?

    • Mithrandir says:

      You would think John McCain would have learned his lesson, after sitting in a North Vietnamese prison, THAT GETTING INVOLVED IN OTHER PEOPLE’S CIVIL WARS IS A BAD IDEA!

      …..And what’s with all this democrat gun hysteria in the U.S., and they want to run out and arm terrorists with GUNS?

      Don’t wait for Republicans rub democrat nose in their own hypocrisy, I am still waiting for them to bring up Ted Kennedy killing his mistress, Clinton abusing women, JFK doing the same, ….you know, all that war on women stuff.

    • GetBackJack says:

      I’m considering starting a website called NOT ONE PENNY MORE .. a Petition website where folks can pledge never to send any more $$ to the Republican Party unless they issue a mea culpa and start representing Conservatism. Rush Limbaugh is right. THEY are ashamed OF US! I say let’s return the favor. Defund them and start fresh.

    • Mithrandir says:

      On the surface, your website idea has some merit, however, consider this: I already don’t send 1 PENNY to those people to begin with! To not send 1 penny UNLESS XY and Z happens is just another set up for failure.
      1. Mea Culpas are just words, and words/promises mean nothing to politicians.
      2. They are liars, and when you start believing liars, that makes you a fool.
      3. Actions THEN money, not the other way around. Show results or forget it.

      It’s really better to just spend your energy supporting other people such as Libertarians, Tea Party, or the Constitution Party etc, instead of engaging in a negative which will never result in the positive changes you desire. It’s like saying your are going to stop funding the turds in the sewer until they stop stinking so much. Just get out of the sewer!

      I used to laugh when liberals said the Republicans were stupid. But you know, there is a lot of truth to that. Republicans continuously support party-suicide issues like amnesty because the democrats say the Mexicans will hate them slightly less.

      Or the Republican tacit acceptance of homosexuality, for the same philosophical reasons.

      Can you imagine Republicans setting the agenda, and having the democrats scramble around to implement a compromise bill? “Guns for all 18 year olds!” and the democrats would rub their hands and compromise on “Guns for all 21 year olds.” Instead, the opposite is happening, and it’s just terrible.

    • canary says:

      I’d say micro-chip the weapons and give them to the Syrian refugees so they can go back and fight with the good Syrian rebels and track them and see what happens.

      Then spray the country with a chemical that will make them fall asleep and we can go over there and figure out the good ones from the bad ones, and micro-chip or get those high-tech visual eye prints so we can track them with their eyeballs.

      We can send those little flying mosquitoes spyware over there and see what’s really going on.

      Because, I’m sure as heck not going to believe anything Susan Rice says after being promoted to be the robotic liar when there is so much technology and no one can show evidence
      of chemicals being used. The public deserves to know and see with their own eyes because there is enough technology since 2001 to see it.

      No doubt Hezbollah is behind it, and let’s not forget their threat of entering the US through Mexico and killing the US with anthrax.

      I think we should work on a wall around Syria as not only would not stop the good ole boy Syria rebels from attacks on Israel, and if they get poisoned we can have guards to make sure the contaminated don’t spread it all around the world.

      Israel is now setting up training somewhat similar to the US in handling contaminated sprayed citizens where they treat the least injured first. Only Israel does not say what they do for the worst contaminated. Will they get morphine in their last minutes, shot if they try and enter the decontamination area. The US did this in Iraq, but fortunately it did not come down to it.
      I’d so more were contaminated by those pills many took too many of.

  5. canary says:

    Japopknic: Electric Motorcycles – Al Qaeda Will Never See This Special Forces Stealth Motorcycle Coming

    Patrick George – June 14 2013

    Hey Al Qaeda, put this in your pipe and smoke it: America’s Special Forces may soon be chasing you down on silent, stealthy electric motorcycles that YOU WILL NEVER SEE COMING.

    Zero Motorcycles, who have an entire line of electric bikes, say the MMX won’t be sold to the public, sadly.

    They are already undergoing testing by Special Forces operatives, who already employ motorcycles in a variety of functions in their missions.


    See pictures. Thank goodness it has old fashion switches but hope the bicycle chain doesn’t fall off.

    ” Zero Motorcycles developed the vehicle under US military contract. The vehicle is painted a matte black, which allows the machine to appear inconspicuous and disappear in the dark.”

    Let’s not forget the Fed were first to try Sedgeway.

  6. canary says:

    Obama’s decision to arm Syrian rebels is based on a vague letter from Susan Rice.
    After all, she’ll say what ever she’s told to say.

    The Washington Post: US letter: Syrian regime used chemical weapons agent sarin twice in

    By AP June 14 2013

    UNITED NATIONS — Syria’s government used the nerve agent sarin on two occasions in the embattled city of Aleppo in March and April, according to a letter from a top U.S. diplomat that The Associated Press obtained Friday.

    The letter from U.S. Ambassador Susan Rice to U.N. Secretary-General Ban Ki-moon also cited two other incidents of possible chemical weapons use by the regime of President Bashar Assad.

    But Ban said Friday he opposes the U.S. decision to send weapons and that there can be no certainty of chemical weapons use in Syria without an on-the-ground investigation.

    He said increasing the flow of weapons to either side “would not be helpful.”

    “The validity of any information on the alleged use of chemical weapons cannot be ensured without convincing evidence of the chain-of-custody,” he said.

    Russia’s U.N. Ambassador Vitaly Churkin echoed Ban.

    “We’ve taken two months to reach this through a very careful and deliberative process,” Rice said.

    Rice said unspecified chemicals, possibly including chemical warfare agents, were used May 14 in an attack on Qasr Abu Samrah and in a May 23 attack on Adra.

    Rice told reporters that the U.S. has “no reliable, corroborated reporting to indicate that the opposition has acquired or used chemical weapons.”


    Canada Free Press: Susan Rice’s Talking Points: The Syrian Chapter

    By Joseph A. Klein – June 15, 2013

    Outgoing United States Ambassador to the United Nations Susan Rice delivered the latest set of the Obama administration’s talking points to reporters on Friday June 14th, this time regarding the Syrian government’s alleged use of chemical weapons and the U.S. response.

    Rice was evidently reading off the same talking points used the day before by Ben Rhodes, the White House Deputy National Security Adviser for Strategic Communications.

    Rhodes had been involved in the re-drafting of the infamous Benghazi talking points, which Rice used in her appearances on five Sunday television talk shows to deliver the false narrative explaining the reason for the tragic killing of four Americans including the U.S. ambassador to Libya, Christopher Stevens.

    Now Rice and Rhodes are back with another set of talking points.

    However, three hundred U.S. Marines have reportedly been deployed to northern Jordan to pave the way for the West to arm Syrian rebels.

    The team of chemical weapons experts appointed by Ban Ki-moon to undertake such an on-site investigation has not yet been able to enter Syria because of a dispute with the government over the scope of the investigation.

    In this context, the upgraded chemical weapons assessment can be seen as a convenient excuse for a decision the Obama administration was prepared to make anyway.

    Whatever his reasons, President Obama’s decision to plunge the United States into another Middle East Muslim quagmire is misguided. First of all, it is too little too late to make any appreciable difference.

    Secondly, we have no way of knowing for sure where our weapons will end up. Operation Fast and Furious and Libya are testaments to the Obama administration’s failure to keep track of weapons transfers to prevent them from getting into the hands of our enemies.

    Obama’s decision to intervene at this time, based on the excuse of Assad’s alleged use of small amounts of chemical weapons, will most likely accelerate the proliferation of those weapons to even more dangerous players in the region.

    According to the Bloomberg report, two administration officials familiar with the internal policy debate who asked not to be identified said “the Obama administration has done virtually no planning for a postwar Syria.

    ” We find ourselves on the same side as the Islamist jihadists who also want to see Assad go.

    The Obama administration is well-practiced in producing talking points but clueless in the foreign policy it is pursuing in the Middle East.


    • canary says:

      oops. I mean the Desert Storm Iraq war when the US put in place their decontamination triage for injured and/or contaminated troops.

  7. canary says:

    While milk and meat prices rise in US, California is exporting surplus milk and alfalfa hay to China.


  8. canary says:

    AsiaNews: Syria rebels’ massacres bolster Syria’s leader

    Massacres by Islamic extremists bolster Bashar al-Assad


    Damascus (AsiaNews) – Summary executions, people sentenced for blasphemy and the expulsion of Christians and Shias from their homes are but some of the actions taken by the courts of the “Caliphate of Iraq and the Levant”, the name the al-Nusra Brigade and other Islamist rebels use in relations to the Syrian territory under their rule.

    A video posted by Islamists on Youtube, almost all foreigners with a North African accent, shows the fighters after a mission.

    In it, the men are seen showing off the bodies of those they killed, mocking them, calling them “dogs” loyal to Assad, saying that they would kill anyone opposed to Islam.

    In recent months, several experts and Syrians interviewed by AsiaNews accused Western and Gulf State media of selective reporting.

    Syrians, including anti-regime Muslims, have begun to criticise[sic] the presence of foreign fighters in their country and to view them as terrorists.

    This is the case in Al-Qusair, one of the first cities to join the rebellion against Assad, and for months one of its stronghold, where residents bemoan the destruction of churches and mosques not aligned with radical Islam.

    In November 2012, the Turkish newspaper Hurryiet stressed the deep cleavages within Syrian rebel forces, warning the West about the risks of armed support, recently endorsed by US President Barak Obama and the governments of France and Great Britain.

    At present, some 30 recognisable militias with some 100,000 fighters operate in Syria.

    Of these, only three belong to the Free Syrian Army, the main interlocutor of the international community.

    The other 27 are linked to Al-Qaeda or belong to other Islamist or political movements.

    Many fighters do not even speak Arabic. Others left villages in Pakistan, Afghanistan, Somalia, Indonesia without knowing the exact location of Syria.


  9. canary says:

    CNN says Al Qaeda taking over Syria

    CNN: Analyst: Al Qaeda affiliate in Syria now best-equipped of the group

    By Barbara Starr. Holly Yan and Chelsea J. Carter, – June 17 2013

    CNN) — Al Qaeda’s affiliate inside Syria is now the best-equipped arm of the terror group in existence today, according to informal assessments by U.S. and Middle East intelligence agencies, a private sector analyst directly familiar with the information told CNN.

    That assessment is shared by some Middle Eastern intelligence agencies that have long believed the United States is underestimating the Sunni-backed al Qaeda movement in the country, according to a Middle East source.

    It is also believed that Iran is running training camps inside Syria for Hezbollah and that other Iranian militia fighters are coming into the country to fight for the regime.

    The analyst has been part of recent discussions with the U.S. intelligence community, which is urgently working to understand what is going on inside the war-ravaged country and is consulting outside experts.

    The analyst, who declined to be named because of the sensitive nature of the information, stressed that all assessments about Syria are approximate at best because of the lack of U.S. personnel on the ground.

    “They are making desperate attempts to get chemical weapons,” the analyst told CNN, noting that in the past few weeks, security services in Iraq and Turkey arrested operatives who were “trying to get their hands on sarin.”

    “I believe you will not deny that one should hardly back those who kill their enemies and eat their organs. … Do you want to support these people? Do you want to supply arms to these people?” Russian President Vladimir Putin asked Sunday.

    He was referring to a widely circulated video that allegedly showed a rebel fighter eating the heart of a dead soldier.

    The pro-government fighters said they’re angry about the U.S. decision to arm the opposition, especially since members of al-Nusra Front have joined the rebels.

    The chairman of the Senate Foreign Relations Committee told CNN’s Candy Crowley there is a strong consensus on arming Syrian rebels.

    “As the Foreign Relations Committee voted nearly a month ago on a strong bipartisan vote of 15-3 … we believe the rebels need to be armed, the moderate elements of those rebels,” said Sen. Robert Menendez, D-New Jersey.

    Britain has not decided whether to provide weapons to rebels but has provided technical assistance and training alongside the United States, France and its other allies.

    Russia’s president said he believed both sides were responsible for the bloodshed. Putin said he hoped the G8 summit this week would help broker a peace deal to end the carnage.

    Putin warns U.S., West against arming organ-eating Syrian rebels


    Well, I guess they aren’t going to explain the growth of Syrian black rebels with African accents
    are the ones eating people’s hearts. They don’t do it to be barbarians, they do it because they think it will give them power. As in one article a rebel ate the entire head of one guy. Double brain power and vision.

  10. canary says:

    Egypt’s Morsi changes tradition encouraging Jihad

    AP: Egypt seen to give nod toward jihadis[sic] on Syria

    By Hamza Hendawi – 06-16-2013

    CAIRO (AP) — Under Hosni Mubarak’s rule, Egypt’s authorities took a tough line on Egyptians coming home after waging “jihad” in places like Afghanistan, Chechnya or the Balkans, fearing they would bring back extremist ideology, combat experience and a thirst for regime change.

    But after Mubarak’s overthrow and his replacement by an elected Islamist president, jihad has gained a degree of legitimacy in Egypt, and the country has become a source of fighters heading to the war in Syria.

    On Saturday, Morsi attended a rally by hard-line clerics who have called for jihad and spoke before a cheering crowd at a Cairo stadium, mainly Islamists.

    Egypt’s powerful military also seemed to distance itself from Morsi speech, in which he pledged that Egypt’s government and military are behind the struggle of the Syrian people against Assad.

    On Sunday, the state news agency quoted an unidentified military official underlining that “the Egyptian army will not interfere in the internal affairs of other countries. It will not be dragged or be used in any of the regional struggles.”

    Under Mubarak’s 29-year rule, Egypt was a major Mideast bulwark against religious militancy. Mubarak closely cooperated with the United States and other Western nations in the hunt for extremists wanted in connection with terror attacks and dismantling the financial networks for militant groups.

    The fall of Mubarak in early 2011 and Morsi’s election nearly a year ago allowed many of the former militants to come in from the cold.


    While Islamic extremists grown in Egypt, it’s interesting the Egypt’s military say they won’t
    fight in Syria for Morsi.

  11. captstubby says:

    Markets are roiled by prospect of early Fed exit
    NEW YORK (AP) — There was no let-up in the flight from stocks and bonds as traders reacted to news that the Federal Reserve could end its massive bond-buying program as next year and as China’s manufacturing slowed.

    The Dow Jones industrial average plunged 353 points, or 2.3 percent, to 14,758 points Thursday.

    The Dow has lost 560 points in the past two days, wiping out its gains from May and June.

    The Standard & Poor’s 500 dropped 40 points, or 2.5 percent, to 1,588. The Nasdaq fell 78 points, or 2.3 percent, to 3,364 points.

    The price of gold dropped and bond yields rose sharply.

    Stocks fell across the board. Twenty stocks fell for every one that rose on the New York Stock Exchange. Trading was very heavy at 4.8 billion shares.

    Quantitative Easing Definition from Financial Times .

    “quantitative easingCentral banks normally set the price of money using official
    interest rates to regulate the economy. These interest rates radiate out to the
    rest of the economy. They affect the cost of loans paid by companies, the cost
    of mortgages for households and the return on saving money. Higher interest
    rates make borrowing less attractive because taking out a loan becomes more
    expensive. They also make saving more attractive, demand and spending reduces.
    Lower interest rates have the reverse effect.
    But interest rates cannot be cut below zero and when official rates get close to
    zero the effect they have on regulating the economy becomes muted. Banks still
    need to make a profit and in troubled times the gap between the official
    interest rate and the rates faced by companies and households can rise, because
    lenders want a greater return for the additional risk of granting a loan when
    times are tough.
    When interest rates are close to zero there is another way of affecting the
    price of money: Quantitative Easing (QE). The aim is still to bring down
    interest rates faced by companies and households and the most important step in
    QE is that the central bank creates new money for use in an economy.
    Only a central bank can do this because its money is accepted as payment by
    everybody. Sometimes dubbed incorrectly “printing money” a central bank simply
    creates new money at the stroke of a computer key, in effect increasing the
    credit in its own bank account.
    It can then use this new money to buy whatever assets it likes: government
    bonds, equities, houses, corporate bonds or other assets from banks. With the
    central bank weighing in, the price of the assets it buys should rise and the
    yield, or interest rate, on that asset will fall. Companies for example with a
    willing central bank seeking to buy its bond, will be able to pay a lower
    interest rate when new bonds are issued or existing bonds come to the end of
    their life and need to be replaced.
    With cheaper borrowing the hope is that the central bank will again encourage
    greater spending, putting additional demand into the economy and pulling it out
    of recession. As the money ends up in bank deposits, banks should also find
    their funding position improved and make them more willing to lend.
    A side effect will be that this new money is expected to raise consumer prices
    giving people another incentive to buy now rather than later.
    Of course there are risks. First, a central bank can lose money on its
    purchases, money that will ultimately have to be underwritten by taxpayers
    either with higher future taxation or by the central bank creating more money
    and risking higher future inflation. Second, go too far with creating and
    spending money and you will destroy the value of the currency. Inflation or even
    hyperinflation is the result. Third, if a descent into QE destroys confidence in
    an economy rather than gives reassurance that the authorities are on the case it
    can be counter-productive.
    That is why central banks cannot use QE willy-nilly, but if you are not
    aggressive enough QE simply will not work to change other interest rates in the
    economy and stimulate demand the trouble is, because the policy is unorthodoxand the situation is dramatic no one knows how much QE is too much and how much is not enough. “

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