Ron Paul seized on his signature issue Friday night at the Liberty Political Action Conference in Chantilly, Va., and tore into Federal Reserve Chairman Ben Bernanke for his announcement Thursday that it would begin pumping money additional money into the economy.
Bernanke announced Thursday that under this plan , known as QE3, the Federal Reserve will print $40 billion more every month for the next several years. The announcement triggered a further downgrading of the nation’s credit rating by Egan-Jones Friday.
“We don’t need to print money,” Paul said. “We’ve already tried QE1 and QE2, and we are going to have perpetual QEs.
“They are going to give $40 trillion each month. That’s half a billion each year, and if necessary they’ll increase it.”
Paul charged that Fed policies such as this one are behind the continuing weak economic confidence Americans have.
“The most important thing investmentwise for people in business is the issue of interest rates,” Paul said. “In a market economy people when save money they drive the interest rates down.
“They’ll say interest rates were 4 percent, now they are 2 percent, so it’s a bad investment.”
This eliminates incentives for businesses and individuals to invest in a risky economy, according to Paul.
“The only real function for the dollar now is debt,” Paul said. “And with the Fed announcing these continuous QEs over the past few days, the dollar has gone down sharply.”