If QE is essentially a printing of liquidity from the fed buying assets from the market, how does those assets on the fed balance sheet affect the everyday citizen? Can’t be positively
Discussion
never is; look at real estate for example and the ripple effects empty neighbourhoods have on the surrounding economy
Yeah, I agree, buying up MBS and then selling them back into the market or holding them til maturity doesn’t sound like something the Fed should be or is capable of doing. And that’s just to get around not being able to just print without Congress consent?
Honestly, just printing may be less detrimental to the average citizen as the sellers of these assets are the only ones that truly gain (and exponentially).
Literally none of it makes sense. Rube Goldberg machine that relies on the majority not understanding.
once the freshly printed money enters the market it inflates the total supply so in a way the seller still gets screwed, the people printing are the real winners
“If people understood how the economic system works, there’s be a revolution in a minute.”
- Hebert Ford
That’s true, they could actually be inflating the asset’s value that they just bought from the seller while simultaneously debasing the liquidity they just handed them lmao. What a world we live in.