2008 GFC is not comparable because QE (buying long term bonds to push down interest rates) does not result in a noticeable increase in the supply of money.
Printing money and sending it to people does. Refer to the chart below.
Printing money and sending it to people does. Refer to the chart below.
https://www.federalreserve.gov/releases/h6/current/default.h...
Also in a lot of ways M2 on its own is meaningless (money sitting under a mattress not being used doesn’t affect the economy) - velocity of money is more useful. Of course, inflation is complex and multicausal so this isn’t the whole picture, but it’s more useful than raw M2 supply.
If I have $1k under the mattress I probably won't risk $100 on a share of CORP. If I have $100k under a mattress, I'm more willing to take a swing.
>Printing money and sending it to people does.
That money wasn't printed, it was borrowed because the Fed cannot do that. Only the US government can do that. The Fed may have bought treasury bonds but those still have to be paid back.
That is new money. Trillions of it.
Do you mean that when securities owned by the Fed mature, the Fed will destroy the money that it had created to buy them?
In practice, I don't think that has really been happening. They have just been reinvesting proceeds in new securities (at least the principal; they send some (all?) interest to the Treasury).
This may change at some point, but so far the Fed has periodically increased its balance sheet while never substantially reducing it [1]. If that continues long term, the Fed's "temporary" money is effectively permanent.