Understanding the Failure of QE

COMMENT: Thank you. That post finally opened my eyes. That’s why there has been no inflation with all the QE and negative interest rates since 2014 here in Europe. If I buy your house and we are in the same country, it’s just a poker game. The number of chips on the board just moved from one player to the other. But if a new player joins the game, the cash pot rises.

I finally understand why you warned the central bankers that the negative rates would never work. Brilliant! I can’t thank you enough. You taught me more in one post than I learned in 4 years of economics class.

You need to write a book.

FH

REPLY: I am working on that now. I hope people will start to understand that the central banks are trapped. That is why Powell warned Congress this spending is “unsustainable.” Central banks normally do not criticize the government. What Powell said was MONUMENTAL, and most people who blame the Fed are blind to the real crisis facing us post-2024.

I still get hate mail from Goldbugs who refuse to open their eyes. Unfortunately, plenty of people will lose their shirts because of their indoctrination into a theory that does not work. The old theories were developed when the exchange rate among nations was based on metal content. There was no major debt market as today where central banks are holding the debt of other nations for reserves in this game of foreign trade and capital flows.