Since the financial crisis of 2008, the Federal Reserve has shrugged off warnings and let the largest U.S. financial firms pay tens of billions of dollars in dividends to shareholders, instead of putting aside money as capital in case a new financial crisis hits.
The goal of the Federal Reserve's low interest rate policy is to juice the economic recovery. The low rates should make it easier for people to borrow money, which they'll hopefully spend; the increased demand for goods and services is then supposed to translate into more hiring.
That's what the Fed is banking on. It hopes low interest rates will help with its mandate of achieving maximum employment, but it also has another mandate: to keep prices stable.
"In many cases, those two conflict," says economist Joe Gagnon of the Peterson Institute for International Economics.
Federal Reserve Chairman Ben Bernanke pauses during a hearing before the House Budget Committee on Feb. 28, 2007.
Credit Alex Wong / Getty Images
Five years ago, a subprime mortgage firestorm was melting down the U.S. economy, but most analysts didn't see it happening.
Federal Reserve Chairman Ben Bernanke, testifying before Congress in February 2007, said the housing sector "is a concern, but at this point we don't see it as being a broad financial concern or a major factor in assessing the course of the economy."
If he and the vast majority of economists were blind to the economic and financial calamity taking shape then, could they also be missing the start of a huge economic boom now?
In a statement timed for release at the end of their most recent meetings, Fed policymakers also said they expect economic growth in coming quarters "to be modest," that the jobless rate will "decline only gradually" and that inflation will run "at ... or below" levels the central bank wants to see.