With the end of Fed's QE in sight, U.S. public says 'Huh?'
By Ann Saphir
SAN FRANCISCO (Reuters) - The Federal Reserve this week is expected to start winding down an epic economic stimulus that is credited with helping the United States claw back from the deepest slump since the Great Depression.
The Fed's $2.8 trillion "quantitative easing" program has, among other things, lifted stock prices to record highs, driven interest rates to record lows and put a floor under what had been a reeling housing market.
Yet barely a quarter of Americans even know what it is.
A poll leading up to the Fed's pivotal decision, expected Wednesday afternoon, found just 27 percent of U.S. adults could pick the correct definition of quantitative easing from among five possible answers.
Quantitative easing, or QE for short, is when the Fed buys bonds in order to push down interest rates and boost the economy.
The ongoing Reuters/Ipsos poll included interviews with 857 adult Americans between September 12 and 16. The result's credibility interval, a measure of its accuracy, is plus or minus 3.9 percentage points.
The Fed's bond-buying program, particularly the current third round known as QE3, has been controversial both at home and abroad, and while some question its effectiveness, Fed Chairman Ben Bernanke says it has helped bring down unemployment and averted a damaging cycle of deflation.
Bernanke has signaled he'll look to reduce the program this year and end it next year, but keep short-term rates low for many months afterwards in order to continue to encourage investment and hiring. Continued...