HOW is bond-buying by the Federal Reserve supposed to help the real economy? Last week, my colleague and I debated the potency of monetary stimulus when household balance sheets were constrained. Instead of arguing in a vacuum, perhaps it would be better to ask Ben Bernanke, the Fed’s chairman, how he thinks the Fed is assisting the recovery. Fortunately, a reporter from Reuters did just that at the press conference held in the afternoon after the announcement of QE3. Mr Bernanke’s response: