Over the past two years, the Federal Reserve has purchased a lot of our public debt. The theory goes that by the Fed soaking up some of the massive federal spending that has gone on for the last two years, it would spur economic activity.To virtually no one's surprise - except dyed in the wool monetarists - it isn't working. The New York Times: The Federal Reserve's experimental effort to spur a recovery by purchasing vast quantities of federal debt has pumped up the stock market, reduced the cost of American exports and allowed companies to borrow money at lower interest rates.But most Americans are not feeling the difference, in part because those benefits have been surprisingly small. The latest estimates from economists, in fact, suggest that the pace of recovery from the global financial crisis has flagged since November, when the Fed started buying $600 billion in Treasury securities to push private dollars into investments that create jobs.As the Fed's policy-making board...(Read Full Post)