Go to http://research.stlouisfed.org/publications/ and go to Economic Synopses. Find publication 2012, No. 4, "Quantitative Easing and Money Growth: Potential for Higher Inflation?"

1.How does the first paragraph describe "quantitative easing"? Was QE a form of open market purchases or open market sales?

2.From the second and third paragraphs, how was QE expected to affect M1? Does the monetary data (M1, M2, excess reserves, and the monetary base) that you looked at in Homeworks #2 and #3 match this expectation?

3. From the last paragraph, what does the author warn as a possible consequence of quantitative easing? Go to the following link and describe if what the author warned about had come true during the post-2008 recovery period