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then of course inflation to
grow a bit as well. In case

talk about it so much in my
fundamental breakdowns but yeah

that constative easing an
example is the US and the Fed

always had a lot of questions
about this especially since I

about bonds and everything but
you can actually purchase

hopefully we can be seeing that
in the next few months and then

end of August in 2021, so quite
a few are about to pull back on

it helped and gave you a better
understanding because I've

of course from that we'll be
seeing DXY and USD increasing

economy but yeah guys this is
it for constative easing I hope

in value but yeah let's just
see what happens with the

different type of QE program
some of them right now it's the

apart from what I've said of
course every economy has a

stocks. Uh so as you we're
going to get into a lesson just

private debt and bonds from the
stocks so that's something that

you're having the question of
why I'm saying you want

we're looking to further on.
Eventually the intended

it aimed to curb deflation and
stimulate their economy after

the financial crisis in Asia in
nineteen ninety-seven. So the

the first to implement
quantitative ease in in which

these are all the things that
you've got to consider but guys

Another example the Japanese
yen. So the Bank of Japan was

inflation there's more consumer
spending more economic activity

Bank of Japan bought bonds and
then private debt as and

constative easing it's one of
the most important things

especially in recent times that
you're going to be seeing so

definitely do more research on
it there's not much else to it

inflation to grow think about
the economic cycle with

way constant easing did not
flow well into the economy

with GDP falling 20 percent a
year over the eight years of

the program. So instead of
actually going in a positive

wasn't distributed well and
instead we saw GDP actually

fall rather than what we
intended for that to grow and

economic stimulation did not go
through well into the economy

a crazy amount. Excess reserves
increased to 2. 7 trillion

arise from QE if not received
well by the general economy and

economy has recovered but at
what cost? At what cost has it

which is far more than you know
the US economy has ever seen.

recovered? You know we've
increased money money supply to

excess reserves to two point
seven trillion which is far

you're actually not seeing
that's that stimulation within

population is the example of
the Fed's QE program between

more than than expected. Now
you can still say of course the

2008 to 2014, the increased
asset purchases of bonds,

easing as a form of monetary
policy how they use it and the

train is all interlinked so we
need to look at constative

course CPI and PPI levels. Now
if you remember back to the

mortgage backed securities and
other assets. This grew the

effects it has now an example
of problems of QE let's look at

purchases and of course money
supply might increase but

more expensive increasing the
cost of production and of

first section of fundamentals
you know we're always referring

so not a crazy influx of money
unlike printed money where that

it can devalue the currency
which make which makes imports

you want. That intended you
know consumer spending. Instead

USD for the first example so an
example of problems that can

back to different areas of the
economy as I said the economics

the economy. You're not seeing
that intended inflation that

effects of QE potentially the
QE program may not work itself

well recovered economy with
increase in economic stimulus.

effects of QE. If implemented
successfully it can lead to a

money goes straight into the
economy. Now the negative

going to get adverse effects.
Now let's look at the positive

effectively into the economy.
So you might see a lot of asset

bank acting as if it's a third
party or an intermediary.

Rather than all of that money
directly into the hands of the

of producing high levels of
inflation. Because it uses the

Now of course this is in
theory. QE is a gradual process

easing is a form of money
printing but carries less risk

consumers. Now if we were just
simply printing money you're

the Bank of Japan. So many
people argue that constative

come about in the past 20 years
I believe ah particularly by

a long time you know ah that's
what central banks would be

doing in the past. Constative
easing is ah something that's

invest printing money now print
money was of course around for

securities so let's just
compare quantitative ease

you're approaching 0% and
you're even at 0% where you've

Remember how we said the
actually the main way of of

got nowhere to go so what's the
next option it's the purchasing

lowering interest rates is not
effective anymore since they

of assets purchasing of bonds
or these mortgage backed

they will reduce interest rates
to increase economic activity

economic growth. If they
receive that inflation without

borrowing and spending but it
gets to a point when when

staglation. So that means when
an increase of inflation but

for. Now why do we actually use
it? Typically it's because

not the intended economic
growth that they were looking

and now inflation is of course
expected but the central banks

are not since they are near 0%
so they need another option. If

eventually when the economy is
trying to recover of course

having a monetary policy is by
controlling interest rates

only want that inflation to
come at the cost of an intended

we quickly go back to the
monetary policies. Here we go.

it's linked to the mortgage
market. So what's the goal of

backed security. So it's a
security in a similar way but

you've got a different type of
security which is a mortgage

supply. As a result that
stimulates economic activity

constitute? The first one of
course is to increase money

actually seeing the economic
growth that's also known as

and eventually they have to pay
back to the investor. And

the government would pay from
somebody and then it matures

purchases longer term assets
such as bonds or mortgage

unconventional monetary policy
in which a central bank

about it because it's it's so
key to every single economy at

a lot of economies around the
world have adapted this

the moment. So quant state of
ease is a form of

backed securities. So before we
get into the rest the two

strategy of constant easing and
of course we need to understand

what it means, how we do it,
and then of course how we go

been explaining it's it's like
a type of loan that you know

types. You've got bonds which
of course we know is as I've

this is a term that I always
use because it's been it's been

so instrumental in the economy
at the moment you know

recovering from the pandemic
recovering from COVID a lot of

we're going to be looking at
quantitative easing or also

following me in my telegram for
a while you'll understand that

Yes hello everyone welcome to
the next video so in this one

known as QE now this is a term
if you don't have been

guys that's it I'll see you in
the next video.