In November, the Federal Reserve announced its quantitative easing initiative to purchase $600 billion of securities. The measure is an attempt to both raise inflation and increase employment. The program quickly became controversial. Inflation hawks worry that this additional intervention could cause prices to rise out of control in coming years, while advocates for the program insist that the Fed can drain money from the system quickly enough to prevent runaway inflation. Even if the latter claim is true, there's definitely some risk involved in the program. But will the benefits outweigh the risk? A new study by the Fed adds some detail to the argument.
According to a working paper (.pdf) written by the Federal Reserve Bank of San Francisco, the $600 billion purchase program will succeed in creating 700,000 jobs. This finding was noted by Fed Vice Chairwoman Janet Yellen at an economics conference over the weekend. In a speech she argued passionately in favor of the program, and used the statistic as proof of the good it will do. While it would be nice to try to evaluate the accuracy of this analysis, it's pretty impossible to do so.
For starters, try reading the paper. Unless you're a professional economist, then you probably won't get very far. It's highly technical, relying on statistic analysis. So while critics of the program can hope that an academic economist could take the time to examine all of the assumptions and math involved, it's no small task.