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NOBEL PRIZE WINNER FAMA TO CNBC'S SANTELLI: 'There's So Much Confusion...

• http://www.businessinsider.com, Sam Ro
 Nobel prize winner Eugene Fama was on CNBC earlier today to discuss the Federal Reserve and its extraordinary monetary policy.

Pragmatic Capitalism's Cullen Roche flagged this heated exchanged between Fama and CNBC's Rick Santelli

Santelli asked specifically about the effects of the Fed's quantitative easing program and the risks associated with it.

"What they are doing... the effects are being greatly inflated by the accounts," said Fama.

"What they've doing is issuing a lot of short-term debt — $85 billion a month — and using it to buyback long-term debt with the goal of lowering the interest on long-term debt," he added. "Now they take credit for lowering interest on short-term debt. But in fact what they've been doing should've raised rates on short-term debt."

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