Qualitative easing: Difference between revisions
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'''Qualitative easing''' is a form of [[monetary policy]] whereby a [[central bank]] reduces the average quality of the assets backing its monetary base.<ref name="tragedy_euro">Bagus, Phillip. [http://mises.org/resources/6045/The-Tragedy-of-the-Euro "The Tragedy of the Euro"], 2010.</ref> Qualitative easing could occur, for example, if a central bank were to move from gold being the primary asset backing its monetary base to a collection of assets more heavily composed of government bonds. Qualitative easing occurred in the European Union throughout the early 21st century as the European Central Bank increased its holdings of bonds issued by trouble countries (such as Greece and Italy) which decreased the average quality of the assets backing the Euro.<ref name="tragedy_euro" /> | '''Qualitative easing''' is a form of [[monetary policy]] whereby a [[central bank]] reduces the average quality of the assets backing its monetary base.<ref name="tragedy_euro">Bagus, Phillip. [http://mises.org/resources/6045/The-Tragedy-of-the-Euro "The Tragedy of the Euro"], 2010.</ref> | ||
Qualitative easing could occur, for example, if a central bank were to move from gold being the primary asset backing its monetary base to a collection of assets more heavily composed of government bonds. Qualitative easing occurred in the [[European Union]] throughout the early 21st century as the [[European Central Bank]] increased its holdings of bonds issued by trouble countries (such as [[Greece]] and [[Italy]]) which decreased the average quality of the assets backing the Euro.<ref name="tragedy_euro" /> | |||
{{See also|Quantitative easing}} | {{See also|Quantitative easing}} | ||
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==References== | ==References== | ||
{{reflist}} | {{reflist}} | ||
==Links== | ==Links== | ||
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[[Category:Economic concepts]] | [[Category:Economic concepts]] | ||
[[Category:Interventions]] | |||
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Revision as of 09:50, 11 November 2011
Qualitative easing is a form of monetary policy whereby a central bank reduces the average quality of the assets backing its monetary base.[1]
Qualitative easing could occur, for example, if a central bank were to move from gold being the primary asset backing its monetary base to a collection of assets more heavily composed of government bonds. Qualitative easing occurred in the European Union throughout the early 21st century as the European Central Bank increased its holdings of bonds issued by trouble countries (such as Greece and Italy) which decreased the average quality of the assets backing the Euro.[1]
See also: Quantitative easing
References
- ↑ 1.0 1.1 Bagus, Phillip. "The Tragedy of the Euro", 2010.