Can the Fed save the economy?

I am posting the following link because I believe Reich's analysis of the Fed's attempts to improve the economy is spot on: http://www.huffingtonpost.com/robert-reich/the-republican-recipe-for_b_779121.html

1. Lower the value of the dollar against other currencies: theoretically this action will decrease the cost of our debt and make our exports more competitive. Unintended consequences: other countries respond with attempts to devalue their currencies and neutralize the impact of the Fed's action on their imports and exports; the real cost of our debt is camouflaged by artificially maintained low interest rates.

2. Increase the money supply so banks will lend to business and individuals. Unintended consequence: inflation first of bond prices as investors seek a "safe haven" and then of stock prices as investors seek decent returns on their dollars no longer available in the over-bought bond market. Businesses won't borrow if their revenues are stagnant. Individuals cannot borrow when their incomes have decreased and their debt loads are high.

Evidently I am not the only investor that has opted back into stocks, particularly those with attractive dividends, as bond prices have risen and bond interest rates become anemic. When bond prices finally pull back (and they will) and their interest rates rise, debtor nations like ours are in for a very unpleasant surprise. The cost of debt will soar.

One peculiar side effect of the Fed's recent currency policies is we appear to be teetering on a tightrope between runaway inflation and devastating deflation - a neat trick that does not imply equilibrium.

At this point, the attempts of the Fed to "tweak" the economy back to solid growth could well be doing more harm than good.

Disclaimer: It is far easier to see problems than to provide their solutions. That is one reason I want policy makers and elected officials to be smarter than I am.