While giving his defence of US monetary policy at the ECB right now, Ben Bernanke used a surprising argument: This isn’t quantitative easing.
“Incidentally, in my view, the use of the term “quantitative easing” to refer to the Federal Reserve’s policies is inappropriate. Quantitative easing typically refers to policies that seek to have effects by changing the quantity of bank reserves, a channel which seems relatively weak, at least in the U.S. context. In contrast, securities purchases work by affecting the yields on the acquired securities and, via substitution effects in investors’ portfolios, on a wider range of assets.”
That shows about how much Ben cares about the speculation that goes on in the media. While we debate whether QE causes inflation or not, the professor isn’t even talking about the same thing.
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