Why quantitative easing doesn't work--a blast from the past

[eridani]

http://www.doctorhousingbubble.com/exporting-the-us-housing-bubble-japan-and-china-real-estate-bubbles-currency-intervention/


One of the arguments made about quantitative easing is that it will somehow cause strong inflation and thus cause home prices to move up. Why? The argument follows the logic that the roundabout way the Federal Reserve is printing money will somehow result in consumer inflation and thus push home values up as well. To that, we can point to quantitative easing part one (QEI) and see that U.S. property values clearly did not appreciate with $1.75 trillion of Fed intervention. Why are we to believe another $600 billion will do anything different from the first round? People will say that all this money had to go somewhere and that is true. Much of it went to repair the balance sheet of insolvent banks but has also become hot money around the world. Just because the housing bubble has popped here doesn’t mean it isn’t raging elsewhere in the world. The housing bubbles of Japan in the 1980s and the current China housing bubble give us an interesting look at the aftermath of bursting bubbles, currency intervention, and quantitative easing.

[DeSwiss]

1. It's all smoke and mirrors.....

"Although, in a traditional sense, the swag the privileged class mountebanks have made off with isn't actually money; in reality, they are in possession of a cache of weightless pixels funneling through a matrix of computer systems. There is simply the illusion of money in the vaults of the nation's colossal banking entities. The only thing the financial elite didn’t steal for themselves was any sense of self-awareness, because if there was ever an honest audit of their ill-gotten assets the illusion would be exposed and the house of electronic cards would fly asunder." ~ Phil Rockstroh, http://www.consortiumnews.com/2010/111110a.html">Angry Voters of a Decaying Empire

K&R

[Xenotime]

6. Thank you.

[doc03]

2. From what I understand the money will end up driving up

prices for basic commodities like energy, metals and farm products. You put more money in the system you have more money chasing a fixed amount of goods and the currency is devalued. Lets just hope they catch the inflation before it gets out of hand like back in the 70s.

[PSPS]

3. Nothing will "work" until real wages go up and unemployment goes down.

And there's nothing in the foreseeable future that will do that.

[jtuck004]

4. De money goes to de massas. Den dey gib us de trickle down. 'Cause dey is good peoples.

Until we get off our collective asses and work the system as hard for our benefit as they do for theirs.

[Po_d Mainiac]

5. Wud skuul dy u goz tu

dey onwy trickle on dude.