Study The Different Effects Of QE Policy On The United State And Emerging Market Economies

In 2007, the US subprime mortgage crisis raid, and then evolved into a global financial tsunami. In response to the ensuing global recession, central banks of developed countries cut interest rates to stimulate continuous economic growth. With short-term interest rates close to zero, central banks in developed countries led by the US in favor of the implementation of "quantitative easing", that the central bank through open market operations to buy the commercial bank holdings of illiquid bonds, mortgage bonds and other assets, make them a monetary equivalent, so as to increase the money supply. It is no difference from indirectly printing money. Major developed countries hope to inject a sufficient amount of liquidity into the economy through quantitative easing policy. Such a large scale of monetary easing has never happened before in the history of the world. The results are as expected on the whole. And meanwhile, the global economy, especially the emerging economies has brought a huge impact. Over time, the US economy experiences a steady recovery, and the emerging economies are also this time got a lot of external capital inflows, a thriving domestic scene but dangerous-due to the developed countries’loose money policy, the emerging economies have attracted a lot inflow of hot money, and meanwhile also breaded ground for the formation of the domestic bubbleThe time came in 2014, with the gradual recovery of the US economy, exit quantitative easing gradually become a hot topic of discussion. After the new Fed Chairman Yellen came to power, the United States started to exit the quantitative easing policy. Although time-delayed rate hike, but the US rate hike expectations is becoming more and more intense. During Fed’s exiting quantitative easing, the global economic landscape has undergone a major turning point-sharp depreciation of currencies of emerging economies, the bubble formatted during the quantitative easing policy is showing burst signs. And I also have reason to believe, along with the United States to raise interest rates approaching, the global economy, especially in emerging markets economy will usher in another round of the reign of terror.QE is undoubtedly the protagonist of the past nearly a decade of economic development, and will also be main topic in the future of the global economy. We need to have a depth research on the quantitative easing policy-the study of its theoretical basis, the reason why it can generate so incalculable influences and looking for experience and lessons learned from the practice of quantitative easing. This article’s main context involves why Fed quantitative easing policy did not bring inflation risks as expected but contributed to the explosive growth in emerging economies; and draws on quantitative easing in emerging economies through case studies; although there is the impulse response of policy time lag effect, but the impact has to be greater than the United States; after quantitative easing era, emerging economies currency depreciation, international capital outflows, commodity prices will lead to a new round of the emerging economies of crisis.