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July 30, 2017

The Crash and Why QE4 Will Not Stop The Crash (Video)

By EconMatters

We discuss the Economic Theory that came out of the analysis of the Great Recession of 1929 to 1939, which has led us to our current overleveraged financial system, how and why it will deleverage significantly, and why QE and other Monetary Measures will not work in a recessionary environment, and be ineffective in stemming a massive deflationary cycle in all the assets that benefited in an outsized an unsustainable fashion as the result of the extreme monetary policies of the last 10 years. You cannot incentivize investors to do the heavy lifting for the central banks in a risk off recessionary cycle. This is why QE 4,5,6 and 7 will only create speed bumps to the inevitable capital destruction crashing process, probably playing out for a decade of downward spiraling pressures on what I call the unwinding of the Wealth Effect, in essence the reverse, The Poverty Effect.

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