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View Poll Results: Do you think QE2 will bolster the U.S. economy in a major way?
yes 1 4.76%
no 20 95.24%
Voters: 21. You may not vote on this poll

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Old 10-15-2010, 05:30 AM
 
800 posts, read 2,043,099 times
Reputation: 618

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This question is a little misleading in my eyes and is too general to really give a good answer to in just a Yes or No response. Is it good for the economy? In the short term, maybe. Just like most would argue that QE1 kept us from depression. It helped as a quick band-aid, but overall and in the longer term, no it's a bad idea. So answering No must have a longer term view on things.

One potential issue I don't think has received nearly as much discussion as it deserves is that as we continue to devalue the dollar, with China holding so much of our dollar-denominated treasuries, particularly at the extremely low yield levels, when does China decide that their investment in US treasuries is not worth the risk any longer? Every investor with every investment has a point where a specific investment of theirs just isn't worth the risk any longer. The US has essentially told China (and all other treasury holders) that they're going to print money to pay back their debts. I could imagine what a shock to the system it would have if and when China announces a sale or decreased interest in the purchase of US treasuries.

I'm not a conspiracy theorist in the slightest, but is there any chance that the US Fed knows that foreign investors (primarily China), may be becoming less interested in holding US treasuries, and the Fed is planning to purchase them over the next several months by way of QE2 to keep the market in equillibrium? Something to think about at least.
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Old 01-02-2013, 12:28 PM
 
8,277 posts, read 6,679,557 times
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We have been hearing about the wonders and magic of EQ since 2008 or so, and every time it doesn't seem to make a difference. We still have the same old stagnant economy when all is said and done. It's kind of like how the Europeans that claim each new bailout is going to be what pulls Greece out of their decline, only for another virtually identical payment crisis to crop up 6-8 weeks later.
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Old 01-02-2013, 01:03 PM
 
Location: WA
5,518 posts, read 22,383,049 times
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Quantitative Easing is just a way for the government to cover it's debt by monetizing it. It reduces the value of the currency and is just a new name for what has be going on for well over fifty years. It distorts the economy and the value of all assets and is a part of what is destroying this country.
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Old 01-11-2013, 01:20 AM
 
Location: US
742 posts, read 607,519 times
Reputation: 212
The question should be did the other QEs work? No they DID NOT. Find out why... start there.
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Old 01-11-2013, 08:56 AM
 
19,183 posts, read 16,772,118 times
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Quote:
Originally Posted by truthseeking View Post
The question should be did the other QEs work? No they DID NOT. Find out why... start there.
The first one did, much like taking a drink in a bottle that still had 6oz of fluid in it still worked until the 6oz ran out. Banks lend against equity they can foreclose on. During the crisis even assets with equity could not get funding. After the second QE those who had assets and wanted to tap them already did and we were swimming in negative equity elsewhere. Every QE after that just made it worse making us a high cost economy.
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