Experience Stern | News & Events

Excerpt from The Economist -- "On October 26th, an op-ed in the Wall Street Journal by Michael Spence and Kevin Warsh, both of Stanford University, argued that the Federal Reserve’s $3 trillion bond-buying programme, which was designed to push down long-term rates and boost corporate borrowing, has actually caused business investment to fall. The authors write that the Fed’s unconventional policies to expand the money supply, known as quantitative easing (QE), have made short-term financial assets like stocks and bonds more appealing as their capital value increases, thereby diverting capital from more productive longer-term investments in the 'real economy'. The result has been low investment growth, weak productivity, and stagnant wages."

Read more