The Central Banks can beat a slump through effective employment of the quantitative theory of money, through quantitative easing with much vigor- by continued purchase of assets from non-banking institutions.
However, that is not what the Fed is doing. Ben Bernanke is actually trying to manipulate the interest rates and this policy is not going to be of any value as the low cost of credit for borrowers is offset by reduced income of creditors (interest).
However, that is not what the Fed is doing. Ben Bernanke is actually trying to manipulate the interest rates and this policy is not going to be of any value as the low cost of credit for borrowers is offset by reduced income of creditors (interest).
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