When global central banks began to expand their balance sheets in an attempt to ward off the Great Recession of 2008-2009, their efforts were unprecedented. Never before had we seen so much money creation occur simultaneously on a global basis. At the time, planned central bank quantitative easings (printing money) were well defined in terms of time over which they would occur and magnitude of dollars/foreign currency involved in each QE iteration.
That was then. Despite significant global government borrowing (US Federal debt alone has doubled since 2006) and global central banks printing over $11 trillion since 2008, global economic growth is tepid. In fact, this unprecedented global government borrowing over the last four years has necessitated tax increases in many countries, including the US. The US has sold this as a tax on the wealthy. But when looking at the reality of US Government budget and forward spending projections, there is absolutely no way our federal government can fund its current spending and promises trajectory without very meaningful middle class tax increases to come. Shhh!!! The politicians just have not told anyone yet.
As a bit of a bookend to global central bank balance sheet expansions, we've now come 180 degrees from where we were in early 2009. No longer are central bank quantitative easings defined either in terms of time or magnitude - several central banks have recently promised unlimited money printing over an indefinite period of time.
This is exactly what the US Federal Reserve continues to say and do four years into our current economic recovery. The election of Abe in Japan a month ago cements the fact that the Bank of Japan will join in unlimited money printing. The Bank of England is on the cusp of another round of money stimulus. And despite the recent appearance of calm in Europe, banking system recapitalization has not even begun - it will be quite the eye opener in terms of European Central Bank balance sheet expansion to come. Four years after the Great Recession reportedly ended, global central bank actions are pushing the definitional limit of "unprecedented". ...