At this point in the destructive history of central bank quantitative easing (QE) since the 2008 global financial crash, it needs no further studies to show, that QE’s result has overwhelmingly been to build bloated new asset bubbles by the trillions, while stimulating neither investment, productivity nor economic growth—in fact, suppressing them. It has done this inclusively by turning the biggest Wall Street, London and European banks into still far larger, zombie banks which seek profits by “trading,” speculating rather than making loans; by forcing households into stock and bond market speculations; and by pushing non-productive spending by governments.
So the findings of a great big new study on of eight major nations’ economies by McKinsey Global Institute manages to add just one new angle: As financial assets have grown at least 50% faster than even inflated GDP during this QE period, the assets have overwhelmingly come down to real estate. The 196-page study, The Rise of the Global Balance Sheet: How Productively Are We Using Our Wealth? “supports the thesis that massive central bank government bond purchases through quantitative easing have made flows into real estate—now making up an estimated two-thirds of world assets—virtually self-perpetuating.” And obviously, “This strongly contributes to widening global wealth gaps.” This is according to a Nov. 21 article on the study by David Marsh on the Official Monetary and Financial Institutions Forum (OMFIF).
