The large fishbowl

acquarioLet me share an interesting article taken from an American blog.

The article talks about the direct connection between the monetary policies of the central banks and the price of the securities and property assets. For the last 30 years, and with a strong increase in the last 10 years, the economy is growing when the central banks purchase government securities, and vice versa:

Richard Duncan su Financial Education Blog

The QE and all the financial supply solutions tend to impair the balance of the normal well-being assessment parameters. We commonly refer to “growth” as the rise of some macro-economic indices which sometimes have little to do with real economy. For example, in the last months, the main European stock market indices have increased, in line with the unemployment rate.

In my opinion, this information is very important. We deal with non-performing loans and accurately follow the trend of our reference markets, trying to do something useful with our business. Surely you do the same with your own business. If all the interventions of the central banks are decisive for the economy, then our efforts and the debated political manoeuvres (for example, the labour reform) play a role relatively important.

It looks as if we were in a large fishbowl, all trying to build our own place and well-being, while someone outside regulates the water level at their discretion.

It seems that there is no means of escape, however, I believe that there is a solution and I would like to share it in my next post.
Meanwhile, I hope that this article may act as a basis for discussion and, in this regard, I would like to know your opinion about this issue.

Emanuele Grassi