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Quantitative Easing Explained

25704 ratings | 6112469 views
What the Federal Reserve is up to, and how we got here. September 2012 Update: Check out my essay on how the Fed thinks QE will create jobs: http://omidmalekan.com/?p=634 and another on the way the Media covers the Federal Reserve: http://omidmalekan.com/?p=619 by Omid Malekan www.omidmalekan.com @malekanoms
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Text Comments (6140)
RS (18 days ago)
i should not have expected more from a cartoon
TigerLily Gzz (23 days ago)
"I want to bang my head against the wall." ROTGLMBFAO!!
muffinhead121 (1 month ago)
The digital assets investor sent me here ✌🏼
doc retrofuturo (1 month ago)
definitely the twilight zone
BlockChain Mane (1 month ago)
Taylor Eckhardt (1 month ago)
The FED is a big scam and has been since the get-go.
matthe ai (1 month ago)
any fucking bastard bankers here said the Quantitative Easing is good?
Ninja Master (1 month ago)
8+ years later and all this did was kick the can. 2019 recession and bubble burst.
Ninja Master (29 days ago)
+djmars1983 the whole so called recovery was completely artificial and due to central banks creating money. If it was healthy interest rates would have been at normal rates years ago. Worse new problems like too many companies buying back stock will be compounded as they borrowed money to buyback stock.
djmars1983 (29 days ago)
Only because under different circumstances this time the FED actually is sabotaging the market.
Robgoren (1 month ago)
This should be required viewing for every high school student on Earth.
Rick W (29 days ago)
It shouldn't be required for anyone. It's humorous, but that's it. I'm guessing not one person involved with the video has even heard of Triffin, much less understands how the Triffin Paradox and the US drastically cutting the deficit under Clinton played a major role in the trade of derivatives. This simplistic horse crap appeals to the uneducated and should not be put in schools as "education"...
Blan Morrison (1 month ago)
We watched in my community college macroeconomics class. My teacher is awesome.
Gethan (1 month ago)
Best video ever
Kn Kr (2 months ago)
Scott Roge (2 months ago)
“The William Dudley “ ha let me get this straight the guy in charge of selling the treasuries to the Goldman Sac used to be a partner at the Goldman Sacs?!!
Jose Giannavola (3 months ago)
ahaha this is great
skeetorkiftwon (3 months ago)
The plumber does not make more than the Been burn bank.
J Lee (3 months ago)
Hilarious, but fucking sad. System needs to be fixed, but how? oyy
Bernardo Mendes (3 months ago)
One of the best videos on Youtube. Needs to be shadow banned.
bobby sands (3 months ago)
OMG this is fffffing BRILLIANT!!!!!!
OolTube02 (4 months ago)
Deflation is bad for someone in debt because their debt increases. Guess whether people were more or less in debt during the Recession than otherwise! Also deflation means the amount of money going around decreased. During the Great Depression the amount of money available decreased by 35%. It doesn't matter how low prices are if there is no money coming your way because it's been destroyed.
OolTube02 (4 months ago)
Actually by buying treasuries they're destroying money at the same time as they're creating money on the reserves side, so in the end there isn't any increase in the amount of money in circulation. Which is why quantitative easing has done nothing to create inflation. Ultimately it's an accounting nothingburger.
liltrollbox (4 months ago)
Best video on YouTube
Ingle Ringlet-Snipps 3rd (4 months ago)
Corruption is the downfall of a civilized nation.
adrienne (4 months ago)
A sucker born every minute and two to take them, and they both work for Goldman Sachs.
Mihail ILIEV (4 months ago)
Shouldn't the moron who created this crap eight years go apologise now?
Mihail ILIEV (3 months ago)
Pablo Malaga I’d also say that you need to educate yourself about central banking
Mihail ILIEV (3 months ago)
Pablo Malaga Yes, he absolutely should. You should at least see that no apocalypse followed the QE policy as so many populists suggested
Pablo Malaga (3 months ago)
Yes, he should apologize for saying the truth. Most people and trolls cannot handle the truth
Sakurablue Sapporo (4 months ago)
Wappend there eye and sounds is like is pink sheep
understand everything (5 months ago)
They be are very reasonable
Trevor Philips (7 months ago)
Schlongberg Sachs
l\ (8 months ago)
HATE robo voice!
Abhijeet Agharkar (9 months ago)
Dino Morea
Trinity Chani (10 months ago)
This one never gets old. I’ve watched it a dozen times at least. “The Fed has been wrong about every major economic development in the past 20 years.” “Is this an episode of the Twilight Zone?” “Is this some kind of nightmare?” YouTube gold. Should be required viewing for every person on the planet.
Achyut Gautam (10 months ago)
Target Auto (10 months ago)
Australians Can Now Purchase BTC, ETH Across 1,200 Newsstands In Win For Adoption Liechtenstein’s Bank Frick Introduces ‘Direct’ Cryptocurrency Investment And Cold Storage Sources: https://cointelegraph.com/news/australians-can-now-purchase-btc-eth-across-1200-newsstands-in-win-for-adoption https://cointelegraph.com/news/liechtensteins-bank-frick-introduces-direct-cryptocurrency-investment-and-cold-storage
Pablo Malaga (3 months ago)
crapto coins are fiat from the same fraudsters as current fiat currencies
Sleeve Of Wizard (10 months ago)
Norm Kid (10 months ago)
"Quantitative easing" = Counterfeiting.
Babylon Central (11 months ago)
Mister K. (11 months ago)
🤣 This video is amazing and hilarious
NutHouseProductionz (1 year ago)
Evil doers!
Ryan Phillips (1 year ago)
I just want to make sure that everyone knows this is super wrong
Mystics Videos (1 month ago)
We know it's wrong what they are doing. It is very correct. Research. Go back to when the Fed Reserve came to be in the early 1900's. Start there.
Nojatha (1 year ago)
My economics professor showed my class this video. It was funny and easy to comprehend.
WestHighway146 (1 year ago)
Because the printing money is the last refuge of failed economic empires and banana republics. The only thing deflating that I can see is the feds credibility. Right before the shit hit the fan and the Leman went bankrupt. You must be shitting me, let me get this straight. Is this an episode of the twilight zone ? I don't think so. I wonder if the Ben Bernank or the Janet Yellow have seen this
tawkinhedz (1 year ago)
Yes, it helped the goldman sachs
Hersheyth Aggarwal (1 year ago)
lol this is hilarious even though its factually incorrect, nice way to troll your econ professor though
Nasha Naufal (1 year ago)
What the!? The Ben Barnake haha 😂
WestHighway146 (1 year ago)
You've got to be shitting me. Is this an episode of the twilight zone.
Tantiwa Hopak (1 year ago)
so true
Hamzah Patel (1 year ago)
What. The Fed is private?!
Tom Nguyen (1 year ago)
when you came here for revision lmao much needed break i guess
Uri Lee (1 year ago)
Annabelle White (1 year ago)
"higher than a year ago"..... *laughing so hard rn*
Frank Ch. Eigler (1 year ago)
Almost 6,000,000 views, come on people, let's push it beyond.
catherine looper (1 year ago)
Creepy as shit
max lemelin (1 year ago)
The reason the Fed doesn't buy Treasury Bonds from the Treasury is because it would be illegal(the video is a tad misleading). The central bank is independent of the Treasury(wink*) and must conduct all asset purchases in the open market. This is how the taxpayers get screwed by the major banks. Keep in mind, it can not purchase/sell securities, only Foreign Exchange, Treasury Notes and other agency debt holdings. Also, keep in mind there is little to no knowing of the reserves of the fed because Congress refuses to conduct any real audit.
CaptainRidley (1 year ago)
The Fed is audited constantly. Here: https://www.federalreserve.gov/aboutthefed/audited-annual-financial-statements.htm
TheRealNoodles (1 year ago)
are you retarded or what? The federal reserve's balance sheet is available online for free, every expense, bond sales or whatever is there. But i guess it's too complicated for a dumb ass like you.
David Lopez (1 year ago)
Anybody heard of this thing called Bitcoin?
Water Melon (1 year ago)
Walmart owns the FED
CaptainRidley (1 year ago)
The fuck?
ojideagu (1 year ago)
Just Nutmeg it
stephanie miller (1 year ago)
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Norine (1 year ago)
I am the brown bear
Karen Miranda (1 year ago)
Al gee (1 year ago)
And the Fed is right. The alternative is a depression.
brent smith (23 days ago)
Maybe sometimes you need a correction, and by not allowing that to take place you actually make things worse.
GiveMeEyeballs (1 year ago)
This program bought the FED alot of time, but the end result will be the same, disaster.
Dash's DDR Channel (1 year ago)
leftists gettin triggered in the comments
Liam Crozier (2 years ago)
The big issue I see with QE as Richard Koo (Economist) correctly points out that whilst QE is trying to encourage banks to loan... The everyday businesses and households stop borrowing money in order to pay off their debt. It happened in Japan whereby there was money to be borrowed but they just wanted to pay off their debts even at 0% interest rate. In that case the government needs to borrow money to keep the economy stable until such time businesses and households start borrowing again which is when the government can start paying off their debt. Basically QE doesn't work but yet they keep doing more and more of it causing a huge problem in the long term and now it's doing nothing in the short term. They have so much money in reserves that when they start borrowing again, interest rates will sky rocket.
Patti Zayas (2 years ago)
haaaa, this is so funny..........
MARCO Cardoso (2 years ago)
gregonometry (2 years ago)
how do you create these bear animations lol
DC Tomcat (2 years ago)
If robotic voices are the future, I feel bad for humanity. The maker of this shit must be a very lonely person
David Florian (2 years ago)
hahah well you guys this def worked out for good. This video is on the wrong side of history!
queijo defumado (2 years ago)
queijo defumado (1 year ago)
Cesar Sosa (1 year ago)
+jobama barack how can consumption go down if prices are going dow as well. Another thing to think about is that maybe consumption goes down during a recession because consumers are full of debt, and the goods they aren't consuming may be not that necessary to them in the first place
queijo defumado (1 year ago)
yeah, but if salaries go down consumption also will and prices and than foreever
Cesar Sosa (1 year ago)
jobama barack it's only bad if govermen't doez't let salaries go down as well
Veggie bot (2 years ago)
this is so funny!!
BLUEGENE13 (2 years ago)
lol if you think this is right, you have no real understanding of economics or what is actually being done by the fed
wallstreetfox3 (2 years ago)
The Fed didn't cause the housing bubble. It was Wall Street and speculators. CDO's, sub-prime loans.
emile heskey (2 years ago)
"the lehman" lmfaoo
melsb89 (2 years ago)
SeguiS Àmnais Qais Causa ÀAmais
NeverKnowsBest Paulius (2 years ago)
Someone send this to John Oliver, he needs it.
heydudedolfan13 (6 months ago)
Georgey K or you can just pay it via taxes and regulate how high tuition can be. It'll only apply for public schools.
heydudedolfan13 (6 months ago)
Jay Rocket art degrees aren't worthless. You can get teaching jobs with them.
heydudedolfan13 (6 months ago)
Jay Rocket they should. I have no reason to not pay for it. I'm a teacher. I have an arts degree. I came from an upper middle class home but it was my aunt and uncle because my mom died when I was almost 10. I qualified for grants because I was 18 and considered on my own according to the state and was given 5k per spring and fall semesters. Covered classes and books and even had money left over for a summer class or two. Where do you think that money came from? You're uneducated. You're a working stiff who works a shitty job and don't want your money going to pay for anything that would allow someone to be better than you. I don't care if your shitty blue collar job pays you more than my teachers salary does. I work 8 months a year and I'm happy. You work a dangerous job and don't have hardly any money because of the amount of kids you have. You live in a state that's subsidized by California and other liberal states.
Georgey K (2 years ago)
Ryan and Dan should not be qualified to comment. Do you really not see any problem in printing money to pay off debt? The purchasing power of the dollar would tank. And do you want to fix the problem of high tuition? The solution is to get the government out of the business of guaranteeing loans to every student, especially since most can not afford it. What happens when the government guarantees loans to every student? It creates an artificial demand for college and schools will jack up the price knowing the loans taking out by the student are backed by the government. The kids who can afford to pay higher price of tuition will continue to do so. Take the government guaranteeing loans out of the picture and the demand will fall and schools will have no choice but to lower tuition.
melsb89 (2 years ago)
Equipe Éduas Àmnais
theknightswhosay (2 years ago)
This is one of the first Youtube videos I remember watching.
himanv (2 years ago)
There is a new biography out on The Alan Greenspan. The Bernank has much to thank The Greenspan for the Fed's stature. Check out the new book.
Be Real (2 years ago)
Vote Trump!!
josh hay (2 years ago)
jnberger (2 years ago)
Jonathan Maydwell (2 years ago)
The quantitative easing is just pumping the gas to crash the global economy harder in an attempt to win the game of global domination.
Jonathan Maydwell (2 years ago)
You are wrong about the Fed. They haven't got it wrong every time. They got it right. They were just pumping the gas to increase the effect so that their related parties could make larger profits when the markets took a dive.
Jim Scott (2 years ago)
Probably a true statement.
savvageorge (2 years ago)
Get your money out of the corrupt banking system while you still can. Invest into digital gold and get up to 1 gram of real gold for free by following this link http://www.Goldmoney.com/r/u6ry3v.
John k (2 years ago)
Basically the government cannot balance the books they are spending more than they get in in revenue So they print money to pay for public sector salaries and pay benefits but it doesnt work it just causes inflation
Georgey K (2 years ago)
Hence all these bubbles forming in our economy creating a false sense of wealth
Georgey K (2 years ago)
"inflation driven by excessive money creation is the result of demand exceeding supply" wrong. Excessive money creation creates a demand that exceeds supply which raises prices aka inflation, it is not the result.
alueshen (2 years ago)
+Jim Scott It's based on a true story too. Glad you enjoyed it!
Jim Scott (2 years ago)
Econ4 Every1 cool story bro.
Econ4 Every1 (2 years ago)
Jim Scott OK, then you don't understand what the cause of inflation is.
Kenya Grant (2 years ago)
The Power of Zen (2 years ago)
how is quantitative easing legal? isnt it printing money from nothing?
Zes (4 months ago)
Funkin no such thing as plebx or overloard about it, idts. be,do/can be,do any nmw and any can be perfx
Chris Hardin (1 year ago)
alueshen But that was all wrong lol
Econ4 Every1 (2 years ago)
You are completely correct, but there is something you may not realize that I hope you don't mind me sharing with you. The debt _is_ the money in the economy. Think about it like this. Imagine a subway/ Rail system in a major metropolitan city. Now imagine that it used tokens to pay for rides. What is a token? It is a debt, right? A debt paid for with a ride on a subway. A Walmart gift card is a debt redeemable in goods and services from Walmart. Movie theater tickets are a debt payable in the move stamped on them. So what is a dollar? Fundamentally a dollar is a debt payable in the restitution of your taxes. that is, as long as the government remains in power, it can impose a tax burden upon you of which only payment in the dollars it creates can satisfy. Now, the government has also created legal tender laws, so now you're dollars are debts payable in the goods and services that can be bought with them. Now back to the subway for a sec. A subway is a business, so the more tokens created means there are more little debts, little IOU's floating around out in the world. But if a token is a debt, why would it be that the more tokens there are, the better business the subway is doing? Can you imagine the owners of any business that creates debts like tokens or gift cards or tickets saying to himself..."Gee, I have too much debt out in the world, I better get it back!" Dollars are debts, they are IOU's and the more of them in the world (as long as inflation is low), the better off the economy is. So the debt can't crash the system, only lack of it. Now to offer a little evidence to this claim, think about what a government surplus is. Again, let's go back to the subway. Imagine there are 10,000 subway tokens in circulation all which were created by the owner of the subway. Last week, 9,000 were sold, the next week 9,500. That would create a deficit of tokens from the owner's point of view as there are 500 fewer tokens in the machines to sell than last week. Is that bad? No, it means he sold more rides. As long as there were trains that people could ride and they were on time, no problem! But let's say the subway had a surplus of tokens, the next week. Sales of tokens had fallen to 7000. So now the owners of the subway had 2500 _more_ tokens in the machines to sell. Is that good? No of course not. The tokens are an IOU, If people purchase less and there are more tokens in the machines for people to buy can the subway owner do anything with that surplus of tokens? No, he created the tokens, having more doesn't help him because to him the tokens are IOU's that he can create at any time. He could take 3000 of the tokens and pour them in the ocean, has the subway owner lost anything? No, he can just create more. Same goes for government. The government creates the IOU's, collecting its own IOU doesn't increase its capacity to create IOU's any more than having more subway tokens means the subway owner can create more tokens. Look at the 7 periods in history when the government has run a budget surplus (more tokens). Every single period of sustained surplus was followed by an economic depression, all except the last period of surplus 1998-2001 which within 6 years was followed by two recessions, of which one was the greatest recession in history. Public debt (as distinct from the real problem, private debt) can't crash the economy, public debt makes it possible. It is the _lack of_ public debt that threatens the economy.
Econ4 Every1 (2 years ago)
_"The actual practice of QE is when the federal reserve buys a bunch government bonds from large banks and simultaneously lowers interest rates to EXTREMELY STRONGLY encourage borrowing ."_ Actually,  before 2008 the Fed didn't _set_ interest rates, it set what's called a "target rate", which was little more than "telegraphing" to the banks the kinds of policies the Fed will pursue in the coming months. When the Fed makes bond purchases, it increases the amount number of available reserves banks have to secure loans. The greater the available reserves the fewer banks have to borrow from each other (because bond purchases create more deposits), the lower the interest rate between banks (called the Federal Funds Rate or the inter-bank rate). So you see, it's not purchasing bonds *AND taking some action* to lower rates as you say, but it's the fact that *purchasing bonds **_CAUSES_* interest rates to fall. Can you see the distinction? Again, this description is the way things were done between 1971-2008, that is, the fed used bond purchases and sales as a way to _manipulate_ rates not _set_ them. Today there is about 10 times the amount of available reserves there were before 2008 because of QE, but that's another story. For the time being, all you need to know is that because QE created more reserves than the banks could use, the Fed could no longer manipulate rates as a way to set rates. You know now, that the Fed now dimply pays interest on reserves as a way to push the rate banks to pay above zero. _"They don't just "print more money" to do it (I mean, they do, the US Mint is always running"_ I just want to clarify this point. Very little money is created via printing. Most of it is electronic (and perhaps that's what you mean, more metaphorically, but for others that read this I want to clarify). Money printed is printed only to meet the public's desire to hold physical cash which waxes and wanes with the season. The money that's printed is sold to banks and does not add to the money supply because banks must trade an asset (reserves) for the physcial dollars they acquire. Think of reserves as 2 forms of the exact same thing. Dollars are the physical representation of reserves and then there are electronic reserves. When people hold dollars physically, the amount of reserves in the system declines, but at the same time, dollars are acquired through borrowing, so a bank somewhere holds an asset equal to the physical dollars that exist. The one exception being that the dollars were created via government deficit spending, but that's a whole other can of worms..... _"The reason this whole process exists is because the foundation of a strong economy is the motion of money. Money has to move around, transactions are made, things need to be bought, sold, leased, and rented for the economy to be strong. If people stop buying, money stops moving around. If banks stop lending, money stops moving around. So QE is just an extreme strategy to get a ton of money moving around again so the economy can get back on its feet."_ The first part of that is absolutely correct, but the last part about QE I'm going to disagree with. It was believed that if the banks had greater reserves that they would lend them, but as it turned out, the academics and even members of the Fed still don't understand that banks don't lend reserves. Thanks to the failed experiments called QE, we've proven that. The other thing QE did was allowed the Fed to remove billions, perhaps trillions of dollars of losses from the public sector and transfer them to the private sector. The Fed held those negative assets until they went positive and are now selling them back to the private sector and giving the profits to the Treasury.
TheOmanJam (2 years ago)
II want to bang my head against the wall. You should not do that. Why not? Because the healthcare is too expensive. LMAO!
Ben -G (2 years ago)
"about a year ago!!!" beat drops*
gorgborg (2 years ago)
year ago, year ago!!
Les Mylo (2 years ago)
This was one of the most humorous videos I have ever seen on YouTube...I truly miss the words of Greenspan that weaved a tale of economy and endeavor for the same, the same words that flew around as if a bottle rocket with a twisted stick, twisted and then ended up making absolute and wonderful sense at the end...If the collusion is real, some might say your interests and worries were being teased to find hearing for judgement as the characters in video above shone light so brightly on the facts wjhere no assistance to any portion of the economy happened when QE was tested before... Mama MIA! That's a spicy meatball of a video! Ben Bernank and The "Gold'm in Sacks" LOL!...I can sit as Amicus Curiae for when the shit hit the fan on the doom and gloom that is foreseen for this one.
Abdul Sultan (2 years ago)
So let me get this straight. The fed, which is privately owned, prints digital currency to buy assets that are later going to reward them with actual money FROM banks that are able to ask for any price of "digital currency" they like? Sounds like fair trade to me.
andrew thompson (2 years ago)
the whole point of printing money and lowering interest rates is to keep a slow rate of inflation BEFORE there is deflation. Thats why we don't see prices falling around us. if we start seeing economic deflation, thats when the FED has completely failed. they already have failed in many ways but our economy atleast survived 2008. even though they helped cause the problem, our economy didn't go off the edge.
Chris Ducat (2 years ago)
So they fixed a problem they caused...lovely lol
andrew thompson (2 years ago)
+heydudedolfan13 # Contra scandal # crack kills spread the word
andrew thompson (2 years ago)
+heydudedolfan13 your absolutely right. but you have understand free marketers don't necessarily believe in no government period. just no government restrictions on the "freedom" of the markets. This is exactly whats so dangerous. but that is neither here nor there. sounds like we both understand basic economics. my message is simply the Fed is necessary for the socialization of currency. its only when we have poor representation in the Fed that it becomes dangerous.
andrew thompson (2 years ago)
+heydudedolfan13 Reagan also said "Government is not the solution to our problem government IS the problem" this is key in the ideology of free marketers. your right about the fed screwing up causing the depression. the fed had only been around for a decade. the fed is necessary but its a danger when the wrong people are in charge. same thing with any situation.
andrew thompson (2 years ago)
+heydudedolfan13 also thats incorrect. if you do your research, Greenspan and bernanke were definitely supporters of ayn rand. Both Alan and Ben believed that the markets were capable of regulating themselves. they believed in as little government regulation as possible.
GizmoMaltese (2 years ago)
This video is idiotic. Deflation is bad, very bad. Prices dropping sound good to you, the customer but imagine if you're a store and you bought inventory worth $100k but now it's worth $80k because of deflation. Is that good for the store owner? NO! Will the store owner stay in business? NO! That's why it's very very bad. Slow gradual inflation is fine. Think about what things used to cost when you were a kid. When I was a kid I could ride the bus for 25 cents. Now a bus ride is $2.25. Yet the world still works just fine. Please stop the promoting of ignorance!
Econ 101 (2 years ago)
+GizmoMaltese deflation is NOT bad, a credit crunch is bad, something completely different. Prices going down means that productivity and technology make our products and services more competitive, effective, and plentyful. The idea that deflation is bad comes from the liars who WANT inflation so their debt becomes smaller (like governments). If there were no inflation, everyone would become richer and there would be LESS poverty.
k m venezia (2 years ago)
The only stores left are the big pimps like Walmart and those scumbags. The ones paying slave wages to their employees and then telling them to get food stamps and Medicaid. They don't have a problem with being socialist when it comes to subsidizing they biz. I CAN'T WAIT FOR ALL THESE CHAIN STORES TO GO UNDER. I never spend any money there.
Yolanda Prieto (2 years ago)
2:06 did anyone else hear "Right before the shit hit the fan" lol wtf am I watching
Mihail ILIEV (1 month ago)
Pablo Malaga Do you think you know?
Pablo Malaga (1 month ago)
+Mihail ILIEV you don´t even know what money is
Mihail ILIEV (3 months ago)
Pablo Malaga LOL, the video is complete bulshit but given the average intellectual capacity of people I’m not surprised so many ‘geniuses’ like it. I hope you don’t trade it coz you would have lost loads of money
Pablo Malaga (3 months ago)
Only a gov/bankster troll would say that
Yolanda Prieto (2 years ago)
Higher than a year ago?
Yolanda Prieto (2 years ago)
What does it mean?
Steve Patterson (2 years ago)
Hahahaha funny but the fact is the Fed has usually been right about everything but this is a funny video about QE it would be funnier if they got more of the facts right and really focused on the things the Fed actually screws up on not all this other nonsense.
Kapsahautis (2 years ago)
Shawn B (2 years ago)
Beezeecade (2 years ago)
Is that Siri
Matthieu Barbosa (2 years ago)
that's bad..the fed is doing what they can do with the tools they have ...it's still better than a deep recession ..
Sayed Abdullah (2 years ago)
FED is the problem, that's why JFK wants to end them by EO # 11110. And they killed him. Bernanke was the biggest shit printed 500 years of money and now this Bitch knows that bubble is worst than ever. Buy Gold or Short S&P, both way you are looking $Millions in next 2 years or earlier.
Nick G (2 years ago)
This is truthful and all, but I was looking for just a strict definition of QE.
TheRealNoodles (1 year ago)
reserves are not cash you idiot. Nothing new is added when QE started, the central banks removes the securities from the bank in exchange for more reserves. It's just changing to composition of the asset. But the thing is, reserves don't increase the purchasing power of banks. It doesn't give them more ability to grant credit so it didn't work.
John Cutts (1 year ago)
Understood. But why not cut out the middleman and buy the securities off yourself? Cut out The Goldman Sachs.
Lions And Truth (2 years ago)
To carry out QE central banks create money by buying securities, such as government bonds, from banks, with electronic cash that did not exist before. The new money swells the size of bank reserves in the economy by the quantity of assets purchased—hence "quantitative" easing.
Field -Ye Tian (2 years ago)
Don't apologize. I enjoyed reading your essay. I guess one's judgement to banks or anything can definitely be relative rather than absolute. If I experienced the time when deposit a check cost 10% face value, I may think the banks nowadays are charities. And yes you are right, I came to U.S. 8 years ago. I wasn't aware that you can deposit interbank checks free or charge.

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