The U.S. economy, while outpacing its even more anemic rich-nation counterparts, is hardly besieged by runaway growth of the sort that would normally lead central banks to tighten monetary policy. And by even talking about reducing bond buys, the Fed has helped push interest rates up more than a full percentage point, to a two year high, in just a few months. There are a number of possible explanations…. One, sadly, is politics…. Policymakers were clearly caught off guard by the blowback… to unconventional monetary policy…. A second… is the prospect that their asset purchases could adversely affect financial markets… if the prolonged period of low rates stokes asset bubbles. This concern has prompted Kansas City Fed President Esther George to dissent against the Fed’s decisions…. A number of U.S. central bankers including Bernanke have expressed relief about the possibility that the recent back-up in interest rates reflects a healthy removal of froth for a market that had grown complacent about risks. Never mind that the whole point of quantitative easing was to prompt businesses to take risks in the first place. Then there is the issue of efficacy. Is the bond buying having a beneficial economic impact? Here, the Fed itself appears to be changing its mind.