I think it is funny that the entire system can just collapse based on how people feel. Economics has such a strong psychological component to it. The head of the Fed should be a therapist
@@MrGotro1 Everything is driven by supply and demand. Confidence in a currency is just one strong factor that drives up demand and creates scarcity. Maybe I don't fully get what you are getting at with "classic symptom of nations with fiat currency". Even crypto is ruled by a general consensus of the existing confidence in its technology, purpose, uses, etc.
Watching this in late 2022 was insightful. Your criticism of QE2 seems pretty on point. It took 11 years, but you noted the role of QE2 in commodities inflation and I thought that was an excellent point. Everyone simply puts inflation down to the Ukraine-Russia conflict, supply chains, and in some countries (rising wages). The role of 11 years of loose monetary policy and QE2 is rarely mentioned or emphasised.
Not 100% sure on this but I believe that in theory buying back government issued bonds where short term-interest rates are near zero bound, and thus are unlikely to be driven down by such actions, is intended to increase the price of bonds (long term investments) and decrease long term interest rates in the hope that it stimulates investments and other forms of spending.
I've watched several videos from you tonight Tim and they're all excellent. But on every one when you clear the white board there's a black spot just to the right of your face that you never wipe away. (I then discovered that the black spot is on my laptop screen)
Put the money in the hands of wage earners and the economy grows. It is a no brainer! Everything is geared twards the wealthy but nothing is in favor of wage earners. If we increasing wages, reduce healthcare cost, reducing housing costs and just like magic money circulates!
Thanks for video. what do you mean by .. "the Government might buy government Bonds"? If they are government bonds does the government not own them already? Or are these bonds that have been sold to say a bank and now the government is buying them back? Thanks.
Okey so here I am watching a video from 2011 looking to what's going on in 2020. I guess it will have the same effect like back then, Wall Street is having a party and nothing changes for main street people
Invest the money into infrastructure and stop the gross profiting of taxpayer funded project. When tax money is used for projects, wages, health benefits, and retirement is automatic. Stop the gross hoarding of profits by corporations. Stop government contractor bonuses when tax dallors are used. Put the money into the hands of wage earners!
Hi, well explained video! What do you think about the limited supply of Bitcoin available? In that case there would not be a QE, so how can we stimulate the economy during a crises?
He hasn't explained it well. He talks about govt unblocking the economy but doesn't address what caused the blockage . This brief cartoon gives a more realistic (IMO) description. th-cam.com/video/PTUY16CkS-k/w-d-xo.html Let me know what you think .
thanks for explaining what is going on. i think a big factor that you don't appear to mention is personal debt. Prior to the 2008 crash, banks were lending money to anyone who wanted it regardless of their ability to repay it, this gave the false apperance of a growing economy, but was actually a debt based economy. once that debt was called in by the banking crisis the reality was revealed, the economy was made of debt. so the question that arises is where did all the debt money go, and where is all the QE2 money going? i suspect the answer is that in never really physically existed and the majority of people will never see it make any positive difference to their futures, but our childen and grandchildren will be left with the bill fo QE2, just as working and unemployed people today are being made to pay for the reckless lending of money during the false boom years under the governments austerity programme
There is no benefit in lowering interest/mortgage rates if the prices of houses go up. Thats what many of these crooked real estate agents do, they tell the home owners to increase the asking price because interest rates are all time low.
Why would anyone who has rationally examined the operation of speculators try to stop speculation. Answer: - Out of an ill conceived assumption that speculation is bad when the opposite is true because speculators push prices down as well as up and this flattens out large sudden blockages in price changes which is the same thing that is argued about in this presentation of the government's action to stimulate the economy to eliminate perceived blockages.
Without proper guidance, QE eventually creates asset bubbles which do not provide true value. Returns are diminishing over an extended amount of time. The past 15 years are going to result in a retirement crisis of epic proportions.
This ideas is costing Chinese government Trillions spending on growth in the wrong investment and infrastructures that the people cannot afford to risk comparing to Americans spending more they can afford. Cultural differences is the factor
That's properly explained Sir! A question: when the Central bank rates were let's say at 0%, the banks decided to buy Bonds with a 2% rate rather than lending money at 2% to people. So they would offer loan to people at >2%, right ? But people still did not believe in the economy (i.e. did not believe in salary increase, lower taxes and lower price to buy stuff). Then when the Central bank bought Bonds to increase the demand, therefore increasing the price and lowering the the yield, they compelled the banks to stop investing in Bonds and instead lowering the loan rate to people (let's say at
So basically, people start saving money they buying things, ie not lending money to a bank, our economy would collapse? 🙄 The system is so fucked that using money you don't have is a normal and necessary thing 😂
This feels like a particularly timely video now...
He is now working with kilik and co, if interested you can get him there. Say hi to him. He will appreciate it.
@@sciencetechfreakers3777 I've seen him in Asda working in the bread section
even more timely now :)
Excellent job. It’s the clearest explanation I’ve found on TH-cam. Even my goldfish understood it. Thanks!
Arguably the best way of explaining QE on TH-cam
Best video I’ve seen explaining this. Thank you for simplicity and starting from first principles
Your videos are one of my greatest finds on TH-cam. I am slowly working my way through every single one. You are a hidden gem !! thank you good sir !
I think it is funny that the entire system can just collapse based on how people feel. Economics has such a strong psychological component to it. The head of the Fed should be a therapist
Cute puppies of Earth we call that investor sentiment.
the classic symptom of nations with fiat currency. Literally not worth the paper it's printed on, driven STRICTLY by confidence
@@MrGotro1 Stop it, you're encouraging these people to have thoughts and i don't appreciate it /s
@@MrGotro1 Everything is driven by supply and demand. Confidence in a currency is just one strong factor that drives up demand and creates scarcity. Maybe I don't fully get what you are getting at with "classic symptom of nations with fiat currency". Even crypto is ruled by a general consensus of the existing confidence in its technology, purpose, uses, etc.
Brilliant video. Best description of QE I have seen so far.
12 year later thts is where I have discover this in my 3 year financial education, hope you are still around for providing such valuable content
I think this is the best video that explains everything about QE, Thank you so much
I rarely comment on videos but this explanation was extremely good!
You totally nailed it! We are observing exactly what you have predicted 12 years ago.
Are you coming back? You are the best teacher on TH-cam.
Many thanks for your explanation. I now have a better understanding.
Outstanding explanation. Loved it
Thanks a lot for this video. I'd also appreciate it if you kindly provided a video on the subject of Taylor Rule.
Watching this in late 2022 was insightful. Your criticism of QE2 seems pretty on point. It took 11 years, but you noted the role of QE2 in commodities inflation and I thought that was an excellent point. Everyone simply puts inflation down to the Ukraine-Russia conflict, supply chains, and in some countries (rising wages). The role of 11 years of loose monetary policy and QE2 is rarely mentioned or emphasised.
Thanks for your teachings sir. Respect from india
can someone help? at 11:00 , who is buying bonds and from whom using what money?
This is a great video/explanation. I’m having my 10 year old watch it.
Moral of the story: Jail Bankers who does the bad oopsies.
i like the way you are explaining this!!!
Not 100% sure on this but I believe that in theory buying back government issued bonds where short term-interest rates are near zero bound, and thus are unlikely to be driven down by such actions, is intended to increase the price of bonds (long term investments) and decrease long term interest rates in the hope that it stimulates investments and other forms of spending.
Loved your explanation m8
Outstanding video and information. Thank you for doing it
absolutely wonderful content mate
Thanks a million, you are amazing
Excellent ecplanation!! Thank you !
If Christian Bale chose to be an economist instead of an actor he would be this guy.
He played one in The Big Short. Great role for him, and a great film.
Good job. Simple insights.
I've watched several videos from you tonight Tim and they're all excellent. But on every one when you clear the white board there's a black spot just to the right of your face that you never wipe away. (I then discovered that the black spot is on my laptop screen)
thanks mate great vid
Covid-19 made me think a new way to confront these problems rather than blaming the government for their doings.
Put the money in the hands of wage earners and the economy grows. It is a no brainer!
Everything is geared twards the wealthy but nothing is in favor of wage earners. If we increasing wages, reduce healthcare cost, reducing housing costs and just like magic money circulates!
Here's your answer
@Lou Montana not too good in corona hahah. Big business are the only people who can really spend rn
@@williambonac8157, you are correct!
Why do quantitative easing if it does not work ?and who buys the commodities and what do they do with it ?
Love your videos!!!
great video
Thanks for video. what do you mean by .. "the Government might buy government Bonds"? If they are government bonds does the government not own them already? Or are these bonds that have been sold to say a bank and now the government is buying them back? Thanks.
How does this benefit me???? I'm not borrowing any mone .....
Okey so here I am watching a video from 2011 looking to what's going on in 2020. I guess it will have the same effect like back then, Wall Street is having a party and nothing changes for main street people
The Bloat is on again with Beijing Biden.
Beware the Ides of March.
BASED TH-cam ALGORITHM
Great lecture, but the audio could be better.
The only problem is that the Upload date is the first of April
2022 crew checking in.
Invest the money into infrastructure and stop the gross profiting of taxpayer funded project. When tax money is used for projects, wages, health benefits, and retirement is automatic. Stop the gross hoarding of profits by corporations.
Stop government contractor bonuses when tax dallors are used.
Put the money into the hands of wage earners!
Thank you
Very good!
Basically now with a QT into the recession is that both supply and velocity goes down. Ouch
They should teach it in high school. I am not working in financial sector and I can understand it fairly easily.
Thanks for the great video.
yes by buying stuff you mean government bonds please explain.
Not just Government bonds b/c they also engage in the stock buy backs of corporations (do FANG STKs ring a bell).
Hi, well explained video!
What do you think about the limited supply of Bitcoin available?
In that case there would not be a QE, so how can we stimulate the economy during a crises?
He hasn't explained it well. He talks about govt unblocking the economy but doesn't address what caused the blockage .
This brief cartoon gives a more realistic (IMO) description.
th-cam.com/video/PTUY16CkS-k/w-d-xo.html
Let me know what you think .
who is this guy and how do i find more of him
thanks for explaining what is going on.
i think a big factor that you don't appear to mention is personal debt.
Prior to the 2008 crash, banks were lending money to anyone who wanted it regardless of their ability to repay it, this gave the false apperance of a growing economy, but was actually a debt based economy. once that debt was called in by the banking crisis the reality was revealed, the economy was made of debt.
so the question that arises is where did all the debt money go, and where is all the QE2 money going?
i suspect the answer is that in never really physically existed and the majority of people will never see it make any positive difference to their futures, but our childen and grandchildren will be left with the bill fo QE2, just as working and unemployed people today are being made to pay for the reckless lending of money during the false boom years under the governments austerity programme
I want to thank you all for and explaining 2dr Jermaine
BTW, QE2 is a boat.... and you can be certain there's an analogy here.
There is no benefit in lowering interest/mortgage rates if the prices of houses go up. Thats what many of these crooked real estate agents do, they tell the home owners to increase the asking price because interest rates are all time low.
Um, they can force you to spend your money - negative interest rates!!
10 years later and still doing QE. It is here to stay.
Why would anyone who has rationally examined the operation of speculators try to stop speculation.
Answer: - Out of an ill conceived assumption that speculation is bad when the opposite is true because speculators push prices down as well as up and this flattens out large sudden blockages in price changes which is the same thing that is argued about in this presentation of the government's action to stimulate the economy to eliminate perceived blockages.
How did this age?
Watching this in 2020 when gold is 2k hahahahahaha
4:37
13:45
Without proper guidance, QE eventually creates asset bubbles which do not provide true value. Returns are diminishing over an extended amount of time.
The past 15 years are going to result in a retirement crisis of epic proportions.
timely video
Did he say Chinese mg?
You need to explain what and how bonds work the average Joe just got lost in the entire video
2022 assets at all time high
This ideas is costing Chinese government Trillions spending on growth in the wrong investment and infrastructures that the people cannot afford to risk comparing to Americans spending more they can afford. Cultural differences is the factor
That's properly explained Sir!
A question: when the Central bank rates were let's say at 0%,
the banks decided to buy Bonds with a 2% rate rather than lending money at 2% to people.
So they would offer loan to people at >2%, right ?
But people still did not believe in the economy (i.e. did not believe in salary increase, lower taxes and lower price to buy stuff).
Then when the Central bank bought Bonds to increase the demand, therefore increasing the price and lowering the the yield,
they compelled the banks to stop investing in Bonds and instead lowering the loan rate to people (let's say at
Gonna tell my kids this was Satoshi
Assuming the banking system is not acting selfish and greedy, of course
So there is one e guy (dislike) who failed to understand this
the US dollar hasnt been devalued and QE doesnt print USD.
Can you explain QE forever? Lol
anything new roads, hospital whatever throwing money out of a helicopter just give people money to spend to get the economy going.
Also government can’t force me to spend my money. Haha wait for a CBDC with an expiration date
انت راجل عسلايه ,,ماشاء الله
I cant tell if he is serious or sarcastic
So basically, people start saving money they buying things, ie not lending money to a bank, our economy would collapse? 🙄
The system is so fucked that using money you don't have is a normal and necessary thing 😂
Criminals
Brrrrrrr
In the end part all he did was blabbering...
SO IF EVERY AMERICAN JUST DECIDED TO PULL A HODL WITH THEIR WAGES AND VARIOUS FORMS OF WEALTH.........................? ahahAEHaHaEHaEHAeAHAHEAe