I have been reading about the US Federal Reserve's recent stimulus policy announcement and was asked a very basic question by my husband; "whether printing more money would really help to make the market more wealthier?"
I think the major policy initiative which is termed as "quantitative easing" which broadly covers reducing the mortgage rate, and that too through two major sources only which are housing market and stock market.
It would merely benefit the rich more than the poor...It does not seem to benefit the poor here. More buying houses means prices there would be soaring more for properties ultimately leading to inflation But with the banks having their magnifying glasses on towards lending money would only lend it to those with strong credit records.
Secondly more money would splurge into the stock market as investors would want to earn maximum returns from low rate securities as well as risky ones as well. This again i feel is a blessing for only the investment friendly population, the reason for the same being less earning and more spending which would not leave much money for investments.
With all this i end it here for now with a hope that with the lower interest rates its more property development, more business investments and more lending by the banks.
I think the major policy initiative which is termed as "quantitative easing" which broadly covers reducing the mortgage rate, and that too through two major sources only which are housing market and stock market.
It would merely benefit the rich more than the poor...It does not seem to benefit the poor here. More buying houses means prices there would be soaring more for properties ultimately leading to inflation But with the banks having their magnifying glasses on towards lending money would only lend it to those with strong credit records.
Secondly more money would splurge into the stock market as investors would want to earn maximum returns from low rate securities as well as risky ones as well. This again i feel is a blessing for only the investment friendly population, the reason for the same being less earning and more spending which would not leave much money for investments.
With all this i end it here for now with a hope that with the lower interest rates its more property development, more business investments and more lending by the banks.
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