The unintended consequences of quantitative easing

The unintended consequences of quantitative easing

By Blu Putnam, Chief Economist, CME Group

Highlights

  • Liquidity is critical to efficient risk management using less capital
  • Quantitative easing in Europe, Japan drained liquidity from bond markets
  • Bid/ask spreads widened, diminishing risk management efficiency
  • Europe, Japan’s QE led to sluggish growth, hurt financial sector
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