Think of quantitative easing like a stock buy back in a way.
United Healthcare’s stock was plummeting and they recently did a buyback to stabilize it. The buy back stabilizes it by decreasing supply ie. the number of stocks in circulation. This is essentially a bandaid, ultimately they’re going to have to make some efforts to change their public perception to have a more ‘real’ bounceback. Or they’ll just wait until the recurring cycle of bad press for then slows down.
Quantitative easing is an effort to decrease bond yields (the central bank creates new money to buy bonds from banks, decreasing the amount of bonds in circulation). Better bond yields make it easier to borrow money, whether you have a small business or its your mortgage rate.
This is also a bandaid. Its used in situations like COVID, for example, with the anticipation that supply chain challenges will improve once lockdowns are eased.
The problem here is that the disease isn’t a virus. Its an ideology that has taken root and uplifted conmen like Trump. No amount of quantitative easing can fix that and for the fed to respond this way can only really be interpreted as an act of desperation.
jacksilver@lemmy.world 5 weeks ago
Sounds like the Fed is doing it to keep bond yields down?