A Tale of Two Metrics


Deflation and Why QE Didn’t Cause Hyper-Inflation

By JC Collins

In previous posts I have postulated that QE was used to facilitate the framework construction of the MFS, or multilateral financial system, which will be emerging between now and 2018.  This concept is not an easy one to understand.  The first step is to fully understand what QE, or Quantitative Easing really is and how it works.

For our simplified purposes here we will consider QE to be the exchange of low liquidity assets for high liquidity assets.  And based on that definition we will clarify liquidity as the ease with which money can be used.  As an example, the cash in your wallet and bank account is very liquid, as well as credit cards and lines of credit, they can be used rather quickly in the event you need too.  This is considered high liquidity.

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