In a system that is modeled after track betting but guarantees to backstop the losses of gamblers those gamblers will always take the long shot bet. While the Fed claims that QE is enabling consumer lending, I worry that it is using its common spreadsheet with Treasury to launder those losses in investment banking.

Consumer lending hasn't depended upon deposits to loan since FDR ended the domestic gold standard in '34 and simply pulls any required reserves from thin air. Just the sub-inflation current overnight rate for reserves should be all the incentive needed to lend for mortgages or other long term contracts without creating billions in reserves each month.