@shireblogger @frances_coppola QE has unwanted redistributive effects: financially asset rich doing well, those on wage income badly
— Stephen King (@KingEconomist) May 25, 2013
Dario Perkins, Shire Blogger, Frances Coppola, Pawel Morski
@frances_coppola @kingeconomist @shireblogger And yet its the wealthy who complain most about them...
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger I'm astounded that savers don't seem to realise that low rate policies & QE protect them.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @kingeconomist @shireblogger i think QE has been vital in putting a floor under the deleveraging process, esp in the US
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger It hasn't prevented deleveraging. It's preserved wealth at the expense of incomes.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@darioperkins @kingeconomist @shireblogger and forcing down incomes to preserve wealth hits aggregate demand.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @kingeconomist @shireblogger it stopped income expectations collapsing, especially the first round in the US
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger I think the first round was justified to prevent catastrophic deleveraging.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @kingeconomist @shireblogger that's what I said! Given fiscal tightening, now they are working with v limited options..
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger My concern is further QE is counterproductive especially if done to offset fiscal tightening
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @kingeconomist @shireblogger like Turner, I'd prefer money financed govt spending (but can't admit this out loud.,)
— Dario Perkins (@darioperkins) May 25, 2013
@frances_coppola @kingeconomist @shirebloggerthe real risk with money finance is finding a credible exit strategy..
— Dario Perkins (@darioperkins) May 25, 2013
@frances_coppola @kingeconomist @shireblogger if asset prices were falling now, we'd be seeing more deleveraging. So still net + IMO
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger We are seeing deleveraging. But it is happening through repression of incomes, not wealth.
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @kingeconomist @shirebloggerUS deleveraging has basically been banks refusing to lend. Great Fed paper on debt flows
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger that is consistent with my arg. Cd view QE as preserving current wealth at expense of future....
— Frances Coppola (@Frances_Coppola) May 25, 2013
@darioperkins @kingeconomist @shireblogger ...which also explains demographic effects (wealth preservation protects old at expense of young)
— Frances Coppola (@Frances_Coppola) May 25, 2013
@darioperkins got a link for that? Iirc, drop in debt due to (mortgage) defaults.
— Paweł Morski (@Pawelmorski) May 25, 2013
@frances_coppola @kingeconomist @shireblogger it is another reason why Fed obsessed with getting unemployment down (improve credit scores!)
— Dario Perkins (@darioperkins) May 25, 2013
@pawelmorski about to take my daughter swimming, but will dig it out later! Defaults historically high, but not as important - they show
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger can't see how it can do that while simultaneously preserving wealth unless incomes fall
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @kingeconomist @shireblogger depends if you think QE preserves confidence/employment.
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger not much evidence for that, I'd say. What's the counterfactual?
— Frances Coppola (@Frances_Coppola) May 25, 2013
@frances_coppola @kingeconomist @shireblogger well that's where we struggle because economics has ignore 'confidence' effects. But key 4 fed
— Dario Perkins (@darioperkins) May 25, 2013
@darioperkins @kingeconomist @shireblogger think forward guidance probably more important for confidence effects than anything else
— Frances Coppola (@Frances_Coppola) May 25, 2013
