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> QE and the banks buying stocks is the same thing: No they most certainly are not. QE puts money into the economy. People can then use that money to buy sto
by chollida1 11y ago
> QE and the banks buying stocks is the same thing:
No they most certainly are not. QE puts money into the economy. People can then use that money to buy stocks or short stocks, they can also use that money to do things like travel, purchase a new house or put a kid through school, etc. It can be viewed as a market neutral strategy in terms of buy vs sell pressure on the stock markets.
Now this can cause the stock market to rise through "organic" growth from increased consumption leading to increased corporate profits.
On the other hand the government buying stocks only puts pressure on the buying side of the equations, causing the market to move up.
They both may cause the markets in general to rise, but in terms of market dynamics they are not the same thing:)
- parsnips 11y ago>No they most certainly are not. QE puts money into the economy. Did a helicopter fly over your house?