Fed Source: “The Presses are Rolling”

By Erik Hare

WASHINGTOON (Shroomberg) Rumors have circulated in advance of Monday’s economic data that the Federal Reserve has taken drastic action to keep the real estate market, and the economy, from falling further.

An anonymous source was quoted as saying, “The presses are rolling” on new small denomination bills, which will be scattered throughout large US cities. The exact location of these distributions is still classified, but early speculation has centered around Miami, San Francisco, and other markets that have seen precipitous declines in prices for condominiums.

Federal Reserve Chairman Ben Bernanke (pictured) was unavailable for comment. Previously, he has emphatically stated that "The U.S. government has a technology, called a printing press, which allows it to produce as many dollars as it wishes at essentially no cost."

The Fed Chairman also stated in 2002 that “reflation” of an economy facing downward pressure on prices was desirable. He became known as “Helicopter Ben” by suggesting that tax reductions financed by debt were “essentially equivalent to Milton Friedman's famous ‘helicopter drop’ of money”. It is unknown at this time as to whether the bills rumored to be printed are intended to be dropped by helicopter or other means.

If confirmed, this infusion of new cash into the market would be unprecedented. However, it has been gradually led up to in recent weeks by a series of careful trial balloons. While the focus has been on the stock markets during this period, the unraveling of sub-prime lender New CenturyMortgage brought real estate into the Fed’s focus. Since that time, more aggressive measures have been realized.

The action that is rumored would only be a continuation of the policy taken by Ben Bernanke in his tenure at the Federal Reserve thus far. While it has not yet been confirmed, it is unlikely to be the musings of a desperate writer attempting to make a pathetic April Fool’s joke.