The next recession is coming up soon and I've been wondering how effective our expansionary monetary policy will be. The interest rate doesn't have a ton of room to be lowered and bond yields are half of what they were before the great recession, which leads me to my question.
Since QE suppresses bond yields, if bond yields start out low already and can't be lowered much more, does that mean QE would fail to stimulate investment? And if so, might the government start purchasing other assets like corporate bonds or stocks?
Or am i wrong and bond yields do not effect QE? Maybe QE does not seek to lower bond yields but to only increase market liquidity? (though low-yield treasuries are pretty liquid already)