Remember the quick fix solution to recovering from The Great Recession (the Second Great Depression)? Governments pumped hundreds of millions of dollars into the economy to get things moving again. The economy never really stopped, but it definitely slowed. It was meant to be temporary, and was, almost. The US finally stopped its quantitative easing within the last two years. Its economy is one of the best in the world. That’s why it is easy to overlook that even greater amounts are being pumped out by governments now.
“Central banks around the world are now spending $200 billion a month on emergency economic stimulus measures, pumping this money into their economies by buying bonds. The current pace of purchases is higher than ever before, even during the depths of the financial crisis in 2009.” – Quartz
This is worrisome because it suggests that the economic upheaval is not over, that systemic problems continue, and that they’d be far worse if the governments weren’t printing so much money. Unfortunately, governments can’t print money without consequences. Eventually, they’ll have to stop. Hopefully, that happens after the economies recover; but if the problems are systemic, the recovery won’t happen until after systemic changes. Without a recovery or the change, the economic stimulus can be exacerbating the potentially inevitable retraction. Considering the fact that the stimulus is larger than ever, the retraction could be worse than ever.
(Click on the graph for the link.)