Who Wants a Fed Bond-Buyback Program?

Eighty thousand jobs does not bode well for the immediate future of our economy. The question is what to do about it, if anything. Jon Hilsenrath of the Wall Street Journal ponders this issue in his article, "Weak Report Lifts Chance of Fed Action," updated on July 6.

Should the Fed institute another round of quantitative easing? As Mr. Hilsenrath reports:

Yields on 10-year Treasury notes fell to 1.54% on Friday, near the lowest levels in generations, reflecting market gloom about the economy and also possibly the anticipation of more action by the Fed. Bond-buying programs are meant to push down long-term interest rates to spur spending and investment and to drive investors into riskier assets that might support economic growth, such as stocks.

As the article explains, quantitative easing and bond-buying programs are essentially the same thing. This approach was used in 2010 with less than inspiring results.

I am reminded of the actions of an acquaintance of mine, desperate to change his voice mail message, but failing to do so, time after time. He would dial the same number, press the same button, record the same message, over and over and over again. The message would not take when he tried to play it back, yet he never varied his strategy, resolute in the belief that the strategy that had failed before would somehow work the next time it was implemented--without any variation or adjustment whatsoever.

This is where the Fed finds itself, positioned to give quantitative easing another try, risking inflation while unemployment lingers at 8.2%.

What else is there for us to do?