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Joseph Stiglitz: America's Qe2 Poses 'considerable' Risks

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http://www.telegraph.co.uk/finance/economics/8195572/Joseph-Stiglitz-Americas-QE2-poses-considerable-risks.html

“All this liquidity that they’re creating is not going back to grow the American economy and is going to Asia and other emerging markets where it’s not wanted,” Mr Stiglitz said. “Most of the countries around the world have begun to react. They put in capital controls, exchange rate interventions, taxes on these capital flows - a variety of interventions.”

The Federal Reserve is set to buy an additional $600bn of Treasuries - dubbed QE2 - until June 2011 in an attempt to boost economic growth, according to the central bank's chairman Ben Bernanke.

However, Mr Stiglitz maintains that banks in America will invest money provided under the Fed’s program in Asian and other emerging markets, which have recovered faster from the recession.

An increased rate of capital into such markets could cause currencies to appreciate and create asset bubbles, he warned.

Net private capital flows to emerging market economies will rise 42pc to $825bn in 2010 compared with $581bn in 2009, according to trade group the Institute of International Finance.

Brazil's real has gained 1.5pc against the dollar so far this year, and Chile’s peso has appreciated 6.6pc against the greenback.

“Unintentionally, QE2 is leading to a fragmentation of global financial markets because each country takes actions to protect itself,” Mr Stiglitz said. “As more and more do that, it puts more and more pressure on those that don’t, and they will eventually be forced to take some form of action.”

You can tell why he's won a noble prize, you give banks free money and surprisingly the banks will look for the best return to make the most amount of money so they can then give themselves huge bonuses. If the dollar depreciates against the foreign currency the returns become even larger, meaning even bigger rewards in monopoly money.

Printing free money won't create US jobs.

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http://www.telegraph.co.uk/finance/economics/8195572/Joseph-Stiglitz-Americas-QE2-poses-considerable-risks.html

You can tell why he's won a noble prize, you give banks free money and surprisingly the banks will look for the best return to make the most amount of money so they can then give themselves huge bonuses. If the dollar depreciates against the foreign currency the returns become even larger, meaning even bigger rewards in monopoly money.

Printing free money won't create US jobs.

The banks are in charge of the printing.

http://www.theatlantic.com/magazine/archive/2009/05/the-quiet-coup/7364/

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http://www.telegraph...able-risks.html

You can tell why he's won a noble prize, you give banks free money and surprisingly the banks will look for the best return to make the most amount of money so they can then give themselves huge bonuses. If the dollar depreciates against the foreign currency the returns become even larger, meaning even bigger rewards in monopoly money.

Printing free money won't create US jobs.

Let's see what happens after Ben's managed to blow up China shall we?

Surely Stiglitz can't believe these consequences are unintentional??? :blink:

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Let's see what happens after Ben's managed to blow up China shall we?

Surely Stiglitz can't believe these consequences are unintentional??? :blink:

Do we have a deadline on China blowing up? This month? Next? Next year or in 50 years? How much more printing will be needed to break China? 10 trillion?

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  • 311 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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