4 ms·
My understanding is that the bailouts were completely separate from the quantitative easing. The money for the bailout was raised by selling government debt, an
by OscarCunningham 7y ago
My understanding is that the bailouts were completely separate from the quantitative easing. The money for the bailout was raised by selling government debt, and in exchange for it the government got shares in those banks (the government actually ended up with a profit in the long run). This was all on the government balance sheet.
Meanwhile the money printed for QE was spent buying shares and bonds, and relatively few of those shares and bonds were from the troubled banks. This was all on the Fed balance sheet.
- wallace_f 7y agoQE was the bailout, primarily. It is what economists call monetary policy, with the other side of economic policy being called fiscal policy. The fiscal side of the bailout was much smaller, amost by 3 orders of magnitude. Anyways, it's Ok to be new to a subject but you shouldn't state as much in the first sentence and then start pronouncing what look to be conclusions in the second.