Munich Personal RePEc Archive

An Analysis of the 2008 Global Financial Crisis: Was Quantitative Easing Appropriate?

Naape, Baneng (2019): An Analysis of the 2008 Global Financial Crisis: Was Quantitative Easing Appropriate?

WarningThere is a more recent version of this item available.
[img]
Preview
PDF
MPRA_paper_97816.pdf

Download (559kB) | Preview

Abstract

This essay aims to investigate the effects of Quantitative Easing (QE) on selected macroeconomic and financial market variables. By means of a desktop approach, we find that QE1 had a strong and beneficial impact on the real economy through the banking sector while QE2 and QE3 had small positive or neutral effects on banks and life Insurers. Although QE did not close the gap left by the 2008 global financial crisis, it helped reduce the rate at which the crisis was rising and proved to be an effective crisis management tool. QE boosts the economy in the short run but weakens the economy in the long run. Thus, Central banks should only consider QE when the economy is in crisis and not as a substitution for structural reforms.

Available Versions of this Item

UB_LMU-Logo
MPRA is a RePEc service hosted by
the Munich University Library in Germany.