Behind The Mic With Joe Mathieu: Majority Confused About Fed

BOSTON (CBS) - This is the day Federal Reserve Chairman Ben Bernanke comes down from the mountain to give us the Fed's take on the economy.

It's important because the Fed may actually say something meaningful for the first time in years.

Many traders and economists predict the Fed will reveal plans to slow its economic stimulus program which has been keeping interest rates near record lows for years.

To be clear, that does not mean the Fed will raise rates. But policy makers could give us a clue into when they will.

And because of the way our markets work, the Fed's statement could prompt an immediate increase in rates for mortgages and other loans.

That's why it's wise to understand what's going on here, even if the words Federal Reserve are enough to make your eyes roll into the back of your head.

And if you do understand what the Fed is doing, you are in the minority.

The ongoing Reuters-Ipsos poll finds just over a quarter of Americans actually know what the Fed's stimulus program is, even though some economists believe it saved us from another Great Depression.

Here's the deal.

The Fed's been keeping rates low by buying billions of dollars worth of bonds. It's a program called quantitative easing and it's in its third round.

That's why they call it QE3.

If you're already lost, you need not feel alone because only 27-percent of those surveyed could define quantitative easing.

And it was a multiple-choice question.

Reminds me of when some people thought QE2 was a cruise ship.

Follow Joe on Twitter @joemathieuwbz