As detailed earlier in the month, the Federal Reserve announced more stimulus, otherwise known as QE4, at its recent meeting. Lots of the discussion thus far has focused on whether or not QE will happen and not on the purpose of QE. What we discuss below is a good example of economists discussing the probability of QE rather than why QE is necessary or what it will accomplish. So, what is QE supposed to do? Bernanke told us in his speech over the summer in Jackson Hole: “After nearly four years of experience with large-scale asset purchases, a substantial body of empirical work on their effects has emerged. ... (full story)