In his op-ed in today's Washington Post, Federal Reserve Chairman Ben Bernanke maintains that the latest round of quantitative easing, which involves central bank purchases of securities using money created out of thin air, will work its magic by lifting stock prices and cutting borrowing costs.

Lower corporate bond rates will encourage investment. And higher stock prices will boost consumer wealth and help increase confidence, which can also spur spending. Increased spending will lead to higher incomes and profits that, in a virtuous circle, will further support economic expansion.

There's just one problem: the Fed tried this approach before and it didn't work. Yes,equity and fixed-income markets have rallied, but those moves haven't had the intended effect with regard to the economy as a whole.

Indeed, if the following CFOZone.com report, "Large Company CFOs Grow More Pessimistic," is anything to go buy, a cynic might say that the net result of previous machinations has been anything but positive.

CFOs at large companies are much more pessimistic than they were just three months ago.

According to yet another new survey of chief financial officer sentiment, just 47 percent said they are more optimistic about their company's prospects and 36 percent are less optimistic. Last quarter, nearly two-thirds said they were more optimistic and only 17 percent were less optimistic.

What's more, just one-quarter said they are now more optimistic about their industries versus more than 50 percent last quarter and 35 percent are more pessimistic versus 13 percent last quarter.

Keep in mind that the survey of 77 CFOs-- More than 70 percent are from companies with more than $1 billion in annual revenue and 75 percent are from public companies--by Deloitte LLP was conducted during the two weeks ending on August 31. Since then, the stock market has been surging amid a mixed bag of economic news, the elections took place and the Federal Reserve unveiled its long anticipated Quantitative Easing II plan, which was initially well received by Wall Street.

CFOs in the manufacturing sector appear to be the most pessimistic this quarter-a sharp turn from the prior period when it was the sector with the most improved optimism. These days, only 30 percent of CFOs are more optimistic and 60 percent are less optimistic, according to Deloitte.

In any case, Deloitte points out that more than 85 percent of CFOs' pessimism is currently due to external factors, such as the economy, industry and market trends. These are the kinds of issues they have little or no control over, which can be especially frustrating to this group.

The survey though found that roughly 45 percent of CFOs name top risks that revolve around the specter of stagnant or deteriorating economic conditions and the threat of a double-dip recession.  More than a quarter of CFOs name worries about government policy, regulation, and legislation that could harm their industries and companies.

Michael J. Panzner
Editor, Financialarmageddon.com

Michael J. Panzner is a 25-year veteran of the global stock, bond, and currency markets and the author of Financial Armageddon: Protecting Your Future from Four Impending Catastrophes, published by Kaplan Publishing.