[QE] is definitely a pretty roundabout way of driving money into the real economy. Instead of putting the money directly to work, pay money to people who already have assets even more than their assets are currently trading for, in the hope that they'll put at least some of the money to work.
In a sidenote he addresses "helicopter money" AKA "QE for the people."
QE involves paying over a $ (or Pounds, or Yen) amount in return for an existing asset. This is a crucial feature, and accounts for many of the drawbacks — in particular that the policy benefits above all existing holders of assets. In theory, just handing money to everybody in the country is a more effective and equal way of acheiving its aims. But you don't have to be a hard-money Bundesbanker to be at least a little uncomfortable with where this might end up
QE via asset purchases does strike me as a very roundabout way of addressing a demand shortfall in a substantially consumer driven economy. But as the above post suggests, nothing else may be politically viable.
We just don't see the returns there that are adequate to incentivize us to continue to invest, [Bruce] Rose, 55, chief executive officer of Carrington Holding Co. LLC, said in an interview at his Aliso Viejo, California office. There's a lot of -- bluntly -- stupid money that jumped into the trade without any infrastructure, without any real capabilities and a kind of build-it-as-you-go mentality that we think is somewhat irresponsible.
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