How I changed my view on Quantitative Easing
I found something simple hiding behind it’s complexity
I never used to know what Quantitative Easing was. I’d heard people say it was something along the lines of bailing out the banks. I remember feeling some comfort at having someone to point at, to blame. There was just this background feeling that it didn’t quite seem to make sense. A background fog of confusion. And while I’d love to still believe it, after researching QE for myself, I now see this explanation is almost totally wrong.
In this piece I offer an explanation that may be less comforting.
While financial firms have definitely benefited, if you live in a country that has done QE, you may benefit as well.
It may be hard to see why. After all, Quantitative Easing was a bit like a bail out to financial markets. In this other post I compare it to the ‘Eat Out to Help out scheme’ where the UK government gave a boost to restaurants. But rather than restaurants, it was financial assets that got a boost. And it wasn’t temporary, it’s ended up being permanent.
If you are reading this, your brain may have already begun to feel hazy when I write about financial markets and financial assets. It’s easy to think they have nothing to do with you. As you can’t really see them, it’s…
