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Posts tagged to detox

Is Quantitative Easing (QE) a good detox for banks?


International financial markets became dysfunctional and credit dried up following the collapse of major banks and insurance companies in the US and UK in 2008. At that time, commercial banks were desperate for cash to cover their asset and liability mismatches. In response to highly negative events, the Bank of England (BoE) launched the Quantitative Easing program, with the aim of re-establishing credit conditions by increasing inter-bank lending and, consequently, supporting the overall level of economic activity. Did it work? Apart from the increase in unemployment rates, the major risk… Read more