quantitative easing occurs when the central bank of a nation purchases securities in order to increase the national money supply. the believe is that inflating the central bank's balance sheet will give the economy a boost. for example, the national economy of invest america is in a recession. to help stimulate economic activity, the central bank of invest america issues or create new money that is then used to buy financial assets like bonds from other banks in the country. these banks can then loan the new money received to borrowers. ideally, as it becomes easier to get a loan from the bank, consumers and businesses would spend and borrow more money, thus stimulating the economy. invest america believes that when it's citizens spend more money, there is a greater demand for goods and services, more jobs and more disposable income for the average invest american. however, if the central bank buys mortgage backed assets, for instance, these securities could run the risk of defaulting, potentially costing invest americans even more money. quantitative easing is not an exact science and there is still some debate as to whether it's actually effective. the policy can be seen as a ? measure by the government for a move to gain favor with the public, showing that at least government officials are making an effort to remedy the economic down trend.
- quantitative easing・・・量的緩和
- gain favor・・・支持を得る