Quantitative easing is a ‘dangerous addiction’

BloombergOpinion/Mervyn King

Repost from 7-21-2021

graphic illustration promoting QE FOREVER with fireworks

“The Economic Affairs Committee of the U.K.’s House of Lords, of which I’m a member, has just issued a report on the challenges of using large-scale bond purchases as an instrument of monetary policy. Its title pointedly asks: ‘Quantitative Easing: A Dangerous Addiction?’ In a word, our answer to that question is ‘yes.’”

USAGOLD note:  We posted the original press release from the British parliament on this subject Monday. Mervyn King, the highly respected former governor of the Bank of England, believes quantitative easing should have been used as a temporary measure and that it should now be “dialed back” with authorities “helping investors to plan accordingly.” All of that is taken as sound advice. Much of the damage, though, has already been done as QE’s excesses filter through the economy – not the least inflation coupled with an unhealthy sense of moral hazard.

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