How the the Fed do this? Certainly not by QE, which did none of these things.
> Just look at the cost of a house in 2012 vs 2018
What did the Fed do during this time? Most of the money printed by QE happened from 2009-2013, and QE was shut down completely in October 2014.
QE was the bridge between the two sides of the chasm, hence it's not visible on the graph. We see a rapid fall, a smooth bottom and a nice rise, but it could have been simply a big crash at the bottom and nothing for a decade.
No. QE bought T-bills in order to exchange them for increases in the banks' account balances at the Fed.
TARP funds bought junk-ish bonds back in 2008-2009, but all that did was make banks and financial institutions not go bankrupt from being forced to make subprime mortgages for several decades due to the federal government's policy to "encourage" home ownership.
Also 247,000 to 338,000 over 12 years is not a huge gain. An APR of 2.7% doesn't seem crazy
We did exactly that. The Fed orchestrated the greatest ordinary person bailout the world has ever seen: it reinflated the US housing market and salvaged the net worth of the entire middle class in the process.
It did cause vast inflation. Just look at the cost of a house in 2012 vs 2018 or the equity situation then vs now:
Average gain on a home sale in 1Q04: positive ~$50,000.
Average gain on a home sale in 1Q12: negative ~$50,000.
Average gain on a home sale in 1Q18: positive ~$55,000.
https://i.imgur.com/SfktmBU.png
Median sales price for homes sold in the US:
1Q06: $247,000 (peak bubble...)
1Q12: $238,000
1Q18: $338,000 (!)
Those recent gains are very heavy with inflation courtesy of the Fed, and they are entering the real economy slowly but surely with every exit. That's also why the Fed is being forced to raise interest rates when it's the last thing the economic party wants.
The artificially juiced stock market (artificial courtesy of the low rates), which has created millions of new millionaires in the last four or so years, is also inflationary. It has also helped to salvage countless pension funds for large numbers of ordinary persons, funds that were badly under water. Every time someone sells their hilariously inflated Netflix stock at 200 times earnings, they can thank the Fed, and when they dump that into the economy (consumer goods or housing) it's inflation in action.