THE U.S. BUBBLE ECONOMY IN FOUR CHARTS

THE U.S. FEDERAL RESERVE INJECTS TRILLIONS OF DOLLARS

OF NEWLY CREATED MONEY INTO THE ECONOMY. IS THIS A HOUSE OF CARDS WAITING TO COLLAPSE?

QUANTITATIVE EASING IN ONE CHART

TOTAL ASSETS HELD BY THE FEDERAL RESERVE

SOURCE: NEW YORK TIMES

In three phases since 2008, the Federal Reserve has bought trillions of dollars in bonds, using newly created money to stimulate the economy.

The third phase of Quantitative Easing is likely to end this month (October 2014)

THE FED HAS BOUGHT VAST SUMS OF MORTGAGE-BACKED BONDS

PERCENTAGE OF TOTAL FEDERAL RESERVE ASSETS

SOURCE: NEW YORK TIMES

In its first and third rounds of quantitative easing, the Fed bought not just the U.S. government debt it has traditionally owned,

but securities backed by Americans’ home mortgages.

CONSUMER AND BUSINESS BORROWING COSTS HAVE FALLEN

SOURCE: NEW YORK TIMES

Amid the Fed’s quantitative easing programs, interest rates for both American home buyers and large businesses have fallen.

THE STOCK MARKET HAS RETURNED TO PRE-BUST LEVELS

S&P 500-STOCK INDEX, DIVIDED BY AVERAGE EARNINGS OVER PREVIOUS 10 YEARS, INFLATION ADJUSTED

SOURCE: NEW YORK TIMES

Stocks are trading at a level they previously only reached during the late 1990's stock market bubble and just before the financial crisis.