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Politics : Formerly About Advanced Micro Devices
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To: RetiredNow who wrote (1036244)11/1/2017 8:23:25 AM
From: zzpat  Read Replies (1) of 1573771
 
While I agree with most of what you wrote I have to wonder what you would have done differently? QE was used in Japan and it clearly failed. QE was used in the US as we also increased spending and it worked better than Europe which didn't have QE (in the beginning) and cut spending.

Some countries in Europe went into triple-dip recession after they cut spending. You don't mention anything about spending. Do you agree the US did the right thing when we increased spending?

If the Fed didn't recapitalize the banking system credit would have remained frozen and capitalism can't exist without credit. Considering that QE didn't work in Japan and it seems to have worked in the US (better than what Europe did until it did QE and increased spending) I'm not sure there are or were other options.

At the time I wrote we were headed into a global depression. I didn't know enough about QE other than it failed in Japan but Japan was (is) dealing with deflation, not an economic collapse. After AIG collapsed I couldn't see a way to stop a total collapse. It had to be bailed out.

When you say the Fed stole money that's simply not correct. It lowered interest rates as it does during every recession. Bondholders know this risk and accept it. No one forced them to keep bonds and no one forced them to not invest in equities. Since equities soared for over a decade (hindsight) I'm not sure what harm was caused. Perhaps you can expand on this idea a little more.
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