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Thus the economic benefits of QE are very marginal at best especially as interest rates approach the zero bound. We have reached the limits of what monetary policy can do. What QE CAN do - as pointed out by Stiglitz below, and by Chris Cook in relation to oil prices - is to create asset price and commodity price bubbles - as investors/rentiers search desperately for ever more exotic instruments to generate a return.
These can cause a contraction in the real by economy by increasing costs/making it less attractive to invest in productive activity here - but I expect that to become more of a problem further down the business cycle. At the moment increased (say) houses prices are encouraging an increase in construction activity which (in Ireland at any rate) is still way below the historical average that is required given demographic trends. Index of Frank's Diaries
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