Questions tagged [quantitative-easing]
The quantitative-easing tag has no usage guidance.
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Why hasn't Quantitative Easing surged inflation, or caused hyperinflation?
Quantitative Easing (QE) is the buying of bonds and other financial assets by the Central Bank with high-powered money, or money created by the CB for this purpose.
Isn't this ad-hoc creation of ...
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Quantitative Easing in Africa
I am currently doing a research work on quantitative easing and can't find any example of it occurring in Africa. Have any African central banks ever used QE?
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How is monetary policy sustainable, or even fair, in the current economy? [closed]
I've just read Money Creation in the Modern Economy, an article published by the Bank of England. I'm trying to wrap my head around this from multiple points of view, since it brings about a lot of ...
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What's the difference between Quantitative Easing and regular central bank operations?
Most articles describe QE as purchasing government securities on the market. I thought that was what ordinary day to day operations of the central bank were in their efforts to maintain a target ...
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Is QE the equivalent of printing money?
I heard somewhere that QE is not the same as printing money -- in fact as I know it, QE is the purchase of assets in exchange for more liquid and high-quality, better collaborated debt. In other words,...
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Why doesn't the ECB implement the same fiscal and monetary policy that the FED used to save the US economy?
If the Fed managed to save the US economy with their liberal expansionary policy, why doesn't the ECB follow suit if it is much more efficient in reducing unemployment etc?
Also, why did ...
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Limits to Quantitative Easing Programmes
I have been reading recently on the quantitative easing programmes by the ECB and the BOJ, see http://www.cnbc.com/2016/04/07/what-the-bank-of-japan-boj-will-do-now-that-negative-rates-have-...
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Can quantative easing be summarized as "The state prints cash to pay its debt to private sector"?
I find that most sources describe quantitative easing in an overly complicated way that obscures what it basically means.
As far as I understand a central bank is a public entity owned by a state, ...
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During deflation, is there any risk on 'printing' money?
Take a specific example: Japan.
In the last several years, the central bank of Japan has eased monetary supply for many trillions of dollars, but the CPI decreased in 2016.
My question: is there any ...
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Screw foreign investment, lets just print money
We often hear of countries securing foreign investment. Stores like this are trumped as major achievements. Foreign investment also has criticisms - profits generated in a country end up going abroad, ...
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"Printing" money to build housing
If the government prints money to build housing for cheap rental. Is that a good idea? Or will it damage the economy causing inflation?
Rent will generate income.
Low rent will give poorer more ...
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Are quantitative easing and helicopter cash really different tactics? And how does QE relate to Modern Monetary Theory?
I've been trying to get a clear understanding of exactly what economists mean by Quantitative Easing (QE). It seems to me that different people mean different things by it. I find simplistic analogies ...
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What happened to the money multiplier after QE?
QE meant that the monetary base increased dramatically, yet we don't see such a large reaction in money supply (I am thinking of M4 for the UK) nor in inflation. Why is this money not being lent out? ...
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What is the effect of Quantitative Easing on the US budget deficit?
Is the deficit getting larger because of QE?
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Are Open Market Operations a Gift to the .1%?
My Background
I was an Economics major a long time ago and I don't work in a related field. I have this question that's been nagging me. I hope somebody can answer the questions at the bottom.
...
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What does the Federal Reserve intend to do with bonds it has purchased under QE?
In New York Magazine's interview with investor Mike Burry (made famous by The Big Short), he claims Quantitative Easing has left the Federal Reserve with an extraordinarily high leverage ratio:
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What happens when government bonds purchased as part of central bank quantitative easing (QE) reach maturity?
Does the central bank ask the government to pay or are they rolled over?
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Why inflation is still reported low?
Recently I heard from Richard Koo's video, that central banks have injected so much money to the banking system. There is enough reserves in the U.S. banking system to increase money supply 16 times. ...
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Print money to buy and nationalise companies
If there's a water company worth £4 billion making £500 million a year profit, the government "prints" £4 billion and buys the company, then every year "burns" half the profit and reinvests the other ...
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What stops a government in partnership with its central bank from lowering interest rates and then borrowing at this lower rate to fund investments?
For example, in the UK, after the Brexit vote, the Bank of England decided to lower reserve interest rates to 0.25%. This, as I understand it, has the knock on effect of lowering the interest rates of ...
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How much money was distributed during quantative easing?
I am trying to discover how much money was created as a result of quantative easing. I do not want to start a political debate. But, I am genuinely interested in learning how much money was signed ...
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How is the Corona $2 trilion stimulus package going to be financed?
Perhaps this is a simple question but as a non-US citizen I don't understand how the US government is going to finance the $2 trillion stimulus package to combat the economic damage due to the Corona ...
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Does the government ever pay back its debt from the OMO to the Fed? [closed]
I'm getting confused about how exactly does money being created by the Fed.
From investopidia.com:
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The Fed Lowered Interest Rates, Are they going to buy Bonds?
I originally asked this question on personal finance/money because I didn't know that this exchange site existed. link to same question at person finance/money. Someone on that site mentioned that it ...
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Why is the Australian Government financing the stimulus via debt rather than the RBA?
The Australian Government is engaging in quantitative easing for the first time. The RBA is creating money that is being used to buy bonds on the secondary market so that there is enough liquidity for ...
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Is Quantitative Easing an asset-swapping or money-printing exercise by the Federal Reserve?
Shortly after 2008, there were prominent commentators such as Jim Rogers who called Ben Bernanke an idiot and condemn him for printing money. However, there were also articles that suggest ...
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How does the Federal Reserve unwind the asset purchasing scheme announced in response to the 2020 Coronavirus Pandemic?
On Monday, 06 April, 2020 the Financial Times reported that the Federal Reserve balance sheet could increase to $9 trillion. This is partly due to the myriad of initiatives, some new, to protect the ...
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In quantitative tightening do banks have no choice in refusing to buy bonds from Central Banks (mainly Federal Reserve)
In light of the recent unease about interest rate rise, I've been taking a growing interest in how our economy actually works, something I've been trying to avoid.
So this forum is a way for me to ...
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When the ECB does QE, does it print new money?
I knew that when the Fed in the US buys bonds through Quantitative Easing, it does so using money it has from previous profits and that it doesn't print new money.
However, I was reading this article ...
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To what extent can cryptocurrencies be influenced by monetary policy?
Background
In modern economies, at least up until ~10 years ago, it was assumed that a currency would be technically able to be subjected to monetary policy, that is, where more money is created or ...
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Risks asscoiated short term stimulus as interest rates approach zero
TL;DR
Government interest rates are approaching zero.
What are the risks to borrowing large sums in the current enviroment? Would inflation occur?
Full Story
I was recently reading an article about ...
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How does QE effect the collaterals?
For instance, the ECB accepts green bonds as collateral. And also they are more likely to include green bonds in a QE program.
Does this face make a green bond more valuable? How would it work in a ...
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Why doesn't QE cause the federal funds rate to continue decreasing?
Quantitative easing (QE) is essentially a large-scale form of open market operations, in which the Fed buys large amounts of treasury bills of all maturities (ranging from 1-month to 30-year) and ...
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Why does Fed buying mortgage backed security help lower the interest rate for mortgages?
If Fed buys more mortgage-backed securities, does it necessary mean that the interest rate will go down? Consider the supply and demand market for mortgages and let us assume the supply side is the ...
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How can the Bank of England hold government debt through quantitative easing?
In this article the Economist writes about the BoE:
"in the past decade the bank’s successive rounds of quantitative easing (qe), whereby it creates new money to buy bonds, have left it holding ...
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Are all instances of European quantitative easing in the last 50 years, publicaly documented?
Are all instances of legal, ex nihilo, quantitative easing (QE) within Europe, publically documented for the past 50 years, or is that process/data obfuscated?
If yes, is there a ...
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Any support for the idea that QE is employed to prevent the money supply from contracting
It appears to me that QE has been employed after the collapse of housing bubbles - both in Japan in the early nineties and in many other countries around 2008. During a housing bubble there is a high ...
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Did the Bank Of England say QE doesn't work?
https://www.bankofengland.co.uk/working-paper/2020/does-quantitative-easing-boost-bank-lending-to-the-real-economy
Staff Working Paper No. 883 Published on 14 August 2020
From the conclusion:
If the ...
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Why isn't the Federal Reserve bothered by the drawbacks of its unlimited Quantitative Easing?
On Mar. 26 2020, Fed announces unlimited QE and sets up several new lending programs : finance. I know little on the U.S., as my B.A. economics degree is from a Ontario university. If I remember the ...
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Did (or can) quantitative easing cause an "everything bubble"?
Wolfstreet claims that
It’s true that despite QE globally – not just in Japan – there has been relatively little consumer price inflation in the countries whose central banks perpetrated it. But it ...
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Europe Quantitative Easing
Okay, this is from latest events.
Countries like USA & Japan have successfully used QE to stimulate the economy, but what stops European Central Bank from implementing it?
If they decide to use ...
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How does changing the Bank of England base rate work?
If we assume the demand for money (D above) is fixed in this position (for the purposes of this question), and supply (S) is fixed in this position, then how can the BoE change market interest rates (...
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Why may printing trillions of dollars not lead to inflation?
By definition, inflation should be affected by the increase of the money supply. During the pandemic, there have been numerous huge monetary policies executed, e.g., quantitative easing (QE), ...
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Why does the Fed feel the need to reduce its balance sheet? [closed]
Why does the Fed feel the need to reduce its balance sheet?
What is the problem with the Fed having a large balance sheet long term? What would happen if the value on the Fed's balance sheet ...
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How do central banks get the money for quantitative easing?
From the Wikipedia page on QE:
Quantitative easing (QE) is a monetary policy whereby a central bank purchases predetermined amounts of government bonds or other financial assets (e.g., municipal ...
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During QE what prevents the banks from selling government debt to invest in the stock market instead of lending out the money?
This is how QE is supposed to work:
The fed buys government debt from banks.
This lowers the long term interest rates and businesses and consumers borrow more, which is good for the economy.
But what ...
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Does quantitative easing appreciate or depreciate the domestic currency?
410 gone says the domestic currency depreciates.
You've identified the first-order effect: the supply of local currency has increased, so its price (and from the perspective of other currencies, ...
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Why is quantitative easing compared to "money printing"?
Context
Some questions on this site ask about the difference between "money printing" and "quantitative easing". I am experiencing some difficulties to understand what some of the ...
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Typical duration of bonds purchased in QE
I know that QE involves the purchasing of government bonds by the central bank "printing money" but I am curious about what the typical time to maturity of those bonds are. I.e. the typical ...
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Interest rates in Quantitative Easing of 2008
When the US govt printed money in 2008 and lend it to the banks, how much the banks had to pay in interest?
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