Did sharp criticisms of the Fed just cost Mitt Romney the election?
Some Republicans are crying foul, saying the massive stimulus package just unleashed by the Federal Reserve is nothing more than a thinly veiled bid to help Barack Obama win the White House.
They argue that the history making program is a proverbial one-two punch—but instead of aiming to knock out the recession, Republicans say it was aimed at Mitt Romney’s gut, after the GOP presidential hopeful said back in August he would replace Ben Bernanke if elected president.
Bernanke dismissed talk was taking sides, saying he acted solely because of the dire state of the U.S. labor market.
But Republicans are outraged. Senator John Cornyn (R-TX), head of the Senate Republican Campaign Committee, said the Fed appeared to be "trying to juice the economy" ahead of the Nov. 6 election.
Cornyn and others argue that if the economy appears to be on solid ground and the stock market looks like it’s improving by November 6th, then Barack Obama’s chances for re-election should be much improved.
And with a massive program such as the one just introduced, it may be hard for the economy and the stock market to do anything but accelerate.
The Federal Reserve intends to pump $40 billion into the U.S. economy each month until it sees a sustained upturn in the weak jobs market.
In an addition, the Fed said it was not likely to raise overnight interest rates from their current near-zero level until at least mid-2015. Previously, it had set such guidance at late 2014.
And the Fed will pursue an easy monetary policy "for a considerable time" even after the economy has strengthened.
The actions are largely considered historic and unprecedented because, for the first time in memory, the Fed has tied the length of stimulus program directly to economic conditions.
“Is this Fed driven stock market rally going to re-elect President Obama? Has the Fed gone political?” asked CNBC’s Larry Kudlow on The Kudlow Report. What do you think? We want to know!
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