Well of course it does, "Quantitative easing" is common practice.
> a central bank implements quantitative easing by buying financial assets from commercial banks and other financial institutions, thus raising the prices of those financial assets and lowering their yield, while simultaneously increasing the money supply.
"Sorry?" Does the inflation come as a surprise? We just took a bunch of steps guaranteed to raise consumer prices. Of course we have inflation -- and not the kind caused by monetary policy.
I do not understand why we're considering rate cuts at a time when the stock market is setting records. There is plenty of money seeking investments. Your new business venture can't go directly to the stock market, but publicly-traded banks and companies can invest fund you. They don't need cheap money from the Fed to do it.
The Fed should be trying to cool off the economy, not put more cash into it and driving up consumer prices further. It's meant to be the last line of defense against bust cycles, not a goad to boom cycles.
Well of course it does, "Quantitative easing" is common practice.
> a central bank implements quantitative easing by buying financial assets from commercial banks and other financial institutions, thus raising the prices of those financial assets and lowering their yield, while simultaneously increasing the money supply.
see: https://en.wikipedia.org/wiki/Quantitative_easing
At least one cause of inflation is "increasing the money supply".
Piketty, T. (2014). Capital in the twenty-first century. Harvard University Press.
"Sorry?" Does the inflation come as a surprise? We just took a bunch of steps guaranteed to raise consumer prices. Of course we have inflation -- and not the kind caused by monetary policy.
I do not understand why we're considering rate cuts at a time when the stock market is setting records. There is plenty of money seeking investments. Your new business venture can't go directly to the stock market, but publicly-traded banks and companies can invest fund you. They don't need cheap money from the Fed to do it.
The Fed should be trying to cool off the economy, not put more cash into it and driving up consumer prices further. It's meant to be the last line of defense against bust cycles, not a goad to boom cycles.