Friday at Hoover we will have a series of events reexamining the lessons of the financial crisis and recession. (There is a public event here, in case you're interested. Presenters include George Schultz, John Taylor, Niall Ferguson, Caroline Hoxby and Darrell Duffie.)
In preparing a presentation on QE, I stumbled across the following fact.
1) Canada did not do QE, quantitative easing. (Kjell Nyborg showed us this fact in a very interesting finance seminar on a different topic -- European banks are borrowing from the ECB using rotten collateral)
2) Use vs. Canadian 10 year government bond rates were nearly identical in the QE period.
Conventional wisdom states that US QE lowered interest rates by 1%. I am a skeptic, and this graph reinforces my skepticism.
One might say that the US exports its monetary policy effects to Canada. But the Canadian Dollar is its own currency, so exchange rates, not interest rates should soak up that difference.
One can complain in many ways, but this seems to me to add to the view that QE didn't even change interest rates.
Academic Articles Banking Commentary Cronyism Debt econometrics Economists Energy Environment Euro European Debt Crisis Finance Financial Reform Growth Health economics housing Inequality Inflation Interesting Papers Interviews Labor Language Macro Monetary Policy Nobel Op-eds Politics and economics Regulation Social Programs Stimulus Talks Taxes Teaching Thesis topics Trade Unemployment Videos