Billion-Dollar Bond Fund Manager: QE was a ‘Nonevent’

John Lekas, CEO and senior portfolio manager at Leader Capital, gets it.

"I frankly think QE3 was a complete waste of time," he told CNBC.

"During all the QE programs, [the Fed] bought $2.64 trillion worth of Treasurys. If you look at excess reserves, meaning that the bank just took that money and put it into the Fed—it's $2.67 trillion," Lekas said. "Meaning it was a nonevent, it never mattered, and I don't know why everyone thought it was so important."

Very true. Of course, the real problem starts if banks start to pull the money out of excess reserves and pumping them into the economy.

This is what the exercise really looked like. The spike in excess reserves started when the Fed launched its first quantitative easing:

What Did George Mason University's Tyler Cowen Think About the Massive Quantitative Easing Money Printing of the Federal Reserve?

He is really a Krugmanite on Fed printing. He tells us in an early morning post today:

I have supported the various QEs from the beginning, while seeing them as limited in their efficacy.  At the time, and still, I feared deflationary pressures more than high inflation. 

Got that? He is in favor of the money printing, which means he is ignoring Austrian School Business Cycle Theory. I say ignore, rather than unfamiliar, because people tell me he knows exactly how Fed money printing distorts the economy.

And he also knows that deflation, as a problem is a myth. SEE: Murray Rothbard and the Deflation Bogey