Has the Fed been fueling bubbles?
WASHINGTON — The Federal Reserve’s super-low interest-rate policies have inflated a slew of dangerous asset bubbles. Or so critics say.
They say stocks are at unsustainable prices. California homes are fetching frothy sums. Same with farmland, Bitcoins and rare Scotch.
Under Chairman Ben Bernanke, the Fed has aggressively bought bonds to try to cut borrowing rates and accelerate spending, investing and hiring. Its supporters say low rates have helped nourish the still-modest economic rebound.
Yet some say the Fed-engineered rates have produced an economic sugar high that risks triggering a crash akin to the tech-stock swoon in 2000 and the housing bust in 2006.
GM to invest $1.3B in five factories
DETROIT — Five General Motors factories in three states will soon share in a $1.3 billion investment so they can make higher-quality pickup trucks and new fuel-efficient engines and transmissions.
GM says the money will go to the Flint, Mich., assembly plant; an engine plant in Romulus, Mich., near Detroit; a transmission factory in Toledo, Ohio; and a casting plant in Bedford, Ind. Most of the work will be done during the next two years.
It’s unclear how many jobs the investment will create. GM would say only that it will create or keep 1,000 positions.
Nearly half the money, $600 million, will go to the Flint factory for a new paint shop and other upgrades. The plant makes the Chevrolet Silverado and GMC Sierra pickup trucks.
GM also will spend $493 million at its Romulus engine plant so it can build a new V-6 engine and 10-speed automatic tranmissions that will make vehicles more efficient.
Around $121 million will go to set up a manufacturing logistics center at the Detroit-Hamtramck factory, and $31 million will go to the Toledo transmission plant so it can crank out more six-speed automatic transmissions.