NACBA
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- Jan 19, 2010
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The huge stimulus programs engineered by central banks have done little to boost the global economy and will continue to do harm, says James Grant, editor of Grant's Interest Rate Observer.
"In the past seven years central banks have conjured more than $10 trillion of digital wampum. Still, prosperity eludes them," he writes in the Financial Times. The Federal Reserve's balance sheet has ballooned to $4.5 trillion.
"The juxtaposition between clouds of electronic scrip on the one hand, and ultra-low bond yields on the other, is the financial non sequitur of 2015," Grant says. "If it does not concern the stewards of capital today, it may torment them tomorrow."
History will not treat central banks kindly, Grant says. "The heirs of today's bondholders will read with amazement the history of post-2008 monetary policy," he predicts.
"They will marvel at the faith of a non-church-going people in the mystical powers of central bankers. They will mourn the destruction of the wealth their forebears entrusted to feckless governments at barely positive rates of interest — or, in the cases of Switzerland, Germany and Japan, literally negative.
Read Latest Breaking News from Newsmax.com http://www.Newsmax.com/Finance/Grant-central-bank-bond/2015/01/06/id/616756/#ixzz3O3Mx4hbR
"In the past seven years central banks have conjured more than $10 trillion of digital wampum. Still, prosperity eludes them," he writes in the Financial Times. The Federal Reserve's balance sheet has ballooned to $4.5 trillion.
"The juxtaposition between clouds of electronic scrip on the one hand, and ultra-low bond yields on the other, is the financial non sequitur of 2015," Grant says. "If it does not concern the stewards of capital today, it may torment them tomorrow."
History will not treat central banks kindly, Grant says. "The heirs of today's bondholders will read with amazement the history of post-2008 monetary policy," he predicts.
"They will marvel at the faith of a non-church-going people in the mystical powers of central bankers. They will mourn the destruction of the wealth their forebears entrusted to feckless governments at barely positive rates of interest — or, in the cases of Switzerland, Germany and Japan, literally negative.
Read Latest Breaking News from Newsmax.com http://www.Newsmax.com/Finance/Grant-central-bank-bond/2015/01/06/id/616756/#ixzz3O3Mx4hbR
