By Gary Dorsch, Editor
Global Money Trends newsletter
The theater of the absurd became even more bizarre on Jan 22nd, when the European Central bank <ECB,> desperate to extract the Euro-zone’s economy from the quagmire of deflation and stagnation, decided it would try its hand at the magic elixir of “quantitative easing,” (Q€). Starting on March 1st, the ECB will inject €60-billion of liquidity into the Euro-zone’s money markets, each month until the end of Sept 2016. The ECB is the last of the Big-4 central banks to unleash the nuclear option of central banking – QE, – starting about six years after the Bank of England, the Bank of Japan, and the Fed began flooding the world markets with $7-trillion of British pounds, Japanese yen and US$’s.
Proponents of QE argue that the UK and US-economies are among the best performing in the developed world today, and say the massive doses of money printing and near zero interest rate policies (ZIRP) are the main reasons why. Opponents of QE say the liquidity injections are mostly channeled into the bond and stock markets, – enriching the owners of financial assets, and very little of the QE-injections “trickle down” into the hands of the struggling masses. Instead, thanks to QE and ZIRP, the net worth of the world’s 400 wealthiest has mushroomed to a cumulative $4.1-trillion. The Richest 85-billionaires now control more wealth than half of the world’s population combined, or 3.5-billion persons.
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