QE
Late Windsor matriarch
QE stands for quantitative easing, a monetary policy tool where a central bank creates money to purchase financial assets—typically government bonds—to inject liquidity into the economy.
Central banks deploy QE when interest rates are already near zero and conventional policy tools are exhausted: The Fed launched QE in response to the 2008 financial crisis.
Critics worry it inflates asset prices and benefits the wealthy disproportionately.
National currency management institution
- government bondsState-issued debt securities
- money supplyTotal currency in circulation
- federal reserveNational monetary authority holdings
- stimulusWhat prompts a reaction
Threat of diminishing value
- purchasing powerEconomic spending ability
- price levelAggregate cost measurement
- devaluationLowering of currency worth
- overheatingBecoming dangerously warm
Measures to revive economy
- financial stabilitySound economic standing
- economic growthSustained output increase
- capital marketsSecurities trading venues
- credit availabilityEase of obtaining borrowed funds
borrowing costs · housing market · business investment · consumer spending
central bank
National currency management institution
- government bondsState-issued debt securities
- money supplyTotal currency in circulation
- federal reserveNational monetary authority holdings
inflation risk
Threat of diminishing value
- purchasing powerEconomic spending ability
- price levelAggregate cost measurement
- devaluationLowering of currency worth
overheating · asset bubbles · currency debasement · cost of living
economic stimulus
Measures to revive economy
- financial stabilitySound economic standing
- economic growthSustained output increase
- capital marketsSecurities trading venues
credit availability · borrowing costs · housing market · business investment · consumer spending
Enforced economic stringency
hard money · fiscal conservatism · laissez-faire · gold standard · Austrian economics