“The main effect of QE is to blow up a stock market bubble, making the rich richer, but doing very little for everyone else”, reads the article by Fran Boait in the Positive News.
In 2012 the Bank of England released a paper stating that QE in the UK has increased inequality. The bank calculated that 40 percent of the gains from the increased value of shares and bonds went to the top five percent of households.
QE resulted in low interest rates, and high stock prices, as well as increased inequality and more people in debt.
It does not have to be this way
Many economists and civil society organisations are now calling for a new approach, which is being called QE for People. This is where the central bank creates new money, but rather than flooding financial markets, they instead lend the new money directly to the real, productive economy, either by distributing it via government spending or through direct payments to citizens.
QE for People bypasses the financial markets and gets money straight into the pockets of the people who need it the most.
Read the article in full here.