AI-powered
podcast player
Listen to all your favourite podcasts with AI-powered features
3min snip
The Great Liquidity Debate | Michael Howell & George Robertson on Monetary vs. Fiscal Flows And What Is Truly Driving This Bull Market
Forward Guidance
The Illusion of Quantitative Easing and the Reality of Reserve Management
Quantitative easing theory stands challenged by Japan's experience that disproved the expected outcomes. The flow of funds data from the Federal Reserve does not support the concept of portfolio rebalancing as claimed. The massive assets generated through quantitative easing ended up being redirected back to the Fed through reserve management rather than providing real liquidity as believed. The illusion of liquidity created by quantitative easing was essentially a process of increasing reserves, a precautionary measure stemming from the 2008 financial crisis, rather than the expected easing of financial conditions. The reverse repo market serves as a clear example that challenges the perceived notion of quantitative easing by highlighting its true nature as reserve management, painting a different picture from the popular notion of liquidity infusion.
00:00
Transcript
Episode notes
Get the Snipd
podcast app
Unlock the knowledge in podcasts with the podcast player of the future.
AI-powered
Discover
highlights
Listen to the best highlights from the podcasts you love and dive into the full episode
Save any
moment
Hear something you like? Tap your headphones to save it with AI-generated key takeaways
Share
& Export
Send highlights to Twitter, WhatsApp or export them to Notion, Readwise & more
AI-powered
podcast player
Listen to all your favourite podcasts with AI-powered features
Discover
highlights
Listen to the best highlights from the podcasts you love and dive into the full episode