Wednesday, December 08, 2010
As the great Martin Wolf said "its really, really, really difficult for public institutions to create intelligent policy".
So the main, primary, only focus for QE2 was the value of lowering yields thereby increasing economic acitivity and credit via the interest rate channel. I have long argued that this is not the case with QE, but nevermind that...just look at the effects.
Bond yields rising with each successive wave of QE announcement. And even more "curious", where is the broad based dollar strength that typically (that is, according to accepted economic doctrine) follows increases in yields?