The Lords of Easy Money : How the Federal Reserve Broke the American Economy by Christopher Leonard

The Lords of Easy Money: How the Federal Reserve Broke the American Economy is a book by Christopher Leonard. It examines the role of the US Federal Reserve in shaping the modern American economy, as presented in the source description.

Key details

• Author: Christopher Leonard
• Focuses on the Federal Reserve and quantitative easing
• Discusses the period following 4 November 2010 and the aftermath of 2008
• References the COVID period and rapid expansion of the money supply

Synopsis

The book argues that the Federal Reserve has often been credited for economic growth and for responding to the 2008 financial crisis, while its capacity to reshape the economy for the worse has been overlooked. It describes a major shift on 4 November 2010, when the Fed undertook quantitative easing, expanding the money supply with the stated aim of encouraging banks and investors to take on riskier debt.

According to the description, the policy created long-term risks that were difficult to measure and proved hard to reverse without triggering market instability, leading to further interventions, including during COVID. It links these actions to widening inequality, elevated stock prices relative to corporate profits, record corporate debt, and persistent pressure on middle-class wages alongside rising consumer debt.