The Great Printing Mania

The world economy of the day is driven by great printing mania of central bankers in the developed world.

Since the Post-Clinton era USA has tried to recover its economy from the twin blow of 9/11 attack and tech bubble burst by easy monetary policy. This Bush-era policies coupled with easy monetary policies by Mr. Greenspan created the Sub-prime bubble. The burst of the sub-prime crisis proved to be one of the worst disaster for the world economy. After Mr. Bush, Mr. Obama took over as president and Big Ben stepped into the shoes of Mr. Greenspan. Since then, the only official medicine for ailing US economy has been QEs. The federal reserve has expanded its balance sheet like anything and it appears they have reached the limit of it. It is almost four years since the QE mania started and the feeble growth the US economy is showing is only due to abnormal govt. spending in the country. Besides, the Fed seems to be attempting to recreate the same housing bubble through monthly mortgage buying program (QE infinity), which it is still trying to heal.

All other major central banks have followed Fed's footsteps. The ECB, the Japanese central bank, Bank of England- everyone wants to help their government print and spend. Once the USA has started the game, many are forced to follow the suit in order to maintain relative position in Currency.

But, this game can continue only till inflation is under control. With the ever expanding public debts and ever inflating balance sheets of  central banks, a natural follow up of this mindless printing could be inflation  spiral ling out of control. My belief is that, even central bankers are well aware of that. But the sad story of today is that everyone wants to live for the day. The incentive for making today a sunny day is so tempting that everyone wants to postpone the hard decisions for the future. So, let us dance in the tunes of the rock-stars of the day...the printing mania continues.