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WTF is QE?; Does Stimulus Stimulate?
Topic Started: 4 Sep 2015, 07:28 AM (7,643 Views)
Loki
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Andrew Judd
5 Sep 2015, 03:28 PM
Most of us here believe QE is a swap where a form of money is replaced by another form of money.
Your belief is wrong.
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QE introduces almost zero new buying power into the economy.

Also wrong.

But it's OK that your beliefs are wrong, because otherwise you would need to think about it logically.


“Talk sense to a fool and he calls you foolish.” - Euripides
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Andrew Judd
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Loki
5 Sep 2015, 03:42 PM
Your belief is wrong.


Also wrong.

But it's OK that your beliefs are wrong, because otherwise you would need to think about it logically.
Please explain what you are getting at so your meaning can be understood

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Terry
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Andrew Judd
5 Sep 2015, 03:41 PM
Please explain so that your meaning can be understood
Which version do you want? Taibbi's? Mosler's? Wikipedia?

If you want to deconstruct what QE represents and its implications, by all means go for it. The floor is yours.
Edited by Terry, 5 Sep 2015, 03:58 PM.
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Andrew Judd
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Terry
5 Sep 2015, 03:58 PM
Which version do you want? Taibbi's? Mosler's? Wikipedia?

If you want to deconstruct what QE represents and its implications, by all means go for it. The floor is yours.
If you have a point of view why not share it so it can be understood?

You said:

>> It provides a framework by which financial institutions can lend to the public to maintain the status quo

Why did you say that?

Edited by Andrew Judd, 5 Sep 2015, 04:07 PM.
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Terry
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Andrew Judd
5 Sep 2015, 04:05 PM
If you have a point of view why not share it so it can be understood?
I just did.
Andrew Judd
5 Sep 2015, 04:05 PM
If you have a point of view why not share it so it can be understood?

You said:

>> It provides a framework by which financial institutions can lend to the public to maintain the status quo

Why did you say that?
Because I believe it to be so. Are you suggesting it's not? You obviously have a strong interest in what QE is expect that you have an idea of its objectives, implicit and explicit.
Edited by Terry, 5 Sep 2015, 04:17 PM.
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skamy
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Elastic
5 Sep 2015, 09:51 AM
I guess our entire economic system is based around the concept of yield but when money costs virtually nothing to borrow, there is no reason to expect a return on investment.
So asset prices head to the stratosphere and yield heads to zero.
The last and final crackup boom.
Well that is not what was observed was it - Asset prices have been either static or down and yields have been pretty good. Have you got data to the contrary?
Loki
5 Sep 2015, 03:03 PM
Indeed. And one can always spot the thieves as those who rush to it's defence.
Polishing your own fake halo again.

Anyone who disagrees with your viewpoint must be a thief.

You are so detached from reality it is unbelievable - it appears to me that it is you who would wish ill on anyone and cheer lead the big banks and corporations in anything if you think it would rob the middle and working classes of their property wealth.

Edited by skamy, 5 Sep 2015, 04:21 PM.
Definition of a doom and gloomer from 1993
The last camp is made up of the doom-and-gloomers. Their slogan is "it's the end of the world as we know it". Right now they are convinced that debt is the evil responsible for all our economic woes and must be eliminated at all cost. Many doom-and-gloomers believe that unprecedented debt levels mean that we are on the precipice of a worse crisis than the Great Depression. The doom-and-gloomers hang on the latest series of negative economic data.
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Loki
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Andrew Judd
5 Sep 2015, 03:53 PM
Please explain what you are getting at so your meaning can be understood
I did, earlier in the thread. Why don't you go back to my earlier posts and tell me which parts you don't understand.

Cash and bonds are not equivilent forms of money. Cash is also a unit of measurement. Swapping bonds for cash is not an asset swap in the same way as swapping bonds for equity, or even physical commodities for bonds/equity.

QE II and III was targeted at the risk-free yield curve. Bernanke said as much (let me see if I can find the reference for you).



“Talk sense to a fool and he calls you foolish.” - Euripides
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Andrew Judd
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Terry
5 Sep 2015, 04:12 PM
I just did.

Because I believe it to be so. Are you suggesting it's not? You obviously have a strong interest in what QE is expect that you have an idea of its objectives, implicit and explicit.
OK. So how does QE achieve the objectives that you are claiming it can produce? Alternatively what is the thinking behind the idea that it might be possible it could do that?

I know there are some ideas based in simple explanations of fractional reserve banking in college level textbooks that say filling the banks with reserves will increase lending but there are no experts in banking who agree with that idea. Various central bankers have tried since about the 1960's to get academics to move beyond their simple ideas about banking. Presumably this is the basis of your ideas? Simple textbook ideas about banking?
Loki
5 Sep 2015, 04:21 PM
I did, earlier in the thread. Why don't you go back to my earlier posts and tell me which parts you don't understand.

Cash and bonds are not equivilent forms of money. Cash is also a unit of measurement. Swapping bonds for cash is not an asset swap in the same way as swapping bonds for equity, or even physical commodities for bonds/equity.

QE II and III was targeted at the risk-free yield curve. Bernanke said as much (let me see if I can find the reference for you).
A banknote and an equivalent savings deposit amount are not equivalent forms of money.

What is your point?

If you could remove my savings deposit by force and give me cash what difference does it make to me?

Yes QE has been targetted at the so called risk free end of the spectrum. And? What is your point about that?

I did read your earlier posts (earlier). I could not see what you were getting at.
Edited by Andrew Judd, 5 Sep 2015, 04:28 PM.
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Terry
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Andrew Judd
5 Sep 2015, 04:22 PM
OK. So how does QE achieve the objectives that you are claiming it can produce? Alternatively what is the thinking behind the idea that it might be possible it could do that?

I know there are some ideas based in simple explanations of fractional reserve banking in college level textbooks that say filling the banks with reserves will increase lending but there are no experts in banking who agree with that idea. Various central bankers have tried since about the 1960's to get academics to move beyond their simple ideas about banking. Presumably this is the basis of your ideas? Simple textbook ideas about banking?
Yes, I see your problem. You cannot deal with QE being referred to as a metaphor for money printing. You're not the only one. It's a real bug bear for many people.

Or perhaps you're trying to say that money printing is a boogeyman with no validity or impacts in the real world.
Edited by Terry, 5 Sep 2015, 04:29 PM.
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Loki
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skamy
5 Sep 2015, 04:17 PM
Polishing your own fake halo again.

Anyone who disagrees with your viewpoint must be a thief.

You are so detached from reality it is unbelievable -
Wow! They must be desperate if they pulled you out of the sock drawer so early on in the piece.
Quote:
 
it appears to me that it is you who would wish ill on anyone and cheer lead the big banks and corporations in anything if you think it would rob the middle and working classes of their property wealth.
Your mental illness is not my problem. Seek professional help!


“Talk sense to a fool and he calls you foolish.” - Euripides
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