The Fed this week took a new step by announcing it would use the proceeds from its huge portfolio of mortgage securities to buy government debt. The idea is to make cheap credit a little cheaper, particularly for things like mortgages.
The problem there: Americans who are worried about their jobs, not to mention volatility in the stock market, don’t want to borrow. They saved 6.2 percent of their disposable income this spring. Before the recession, it was more like 1.2 percent.” Read more.