Central banks actions lead to asset price bubbles – Natixis
19.06.2020, 08:20

Central banks actions lead to asset price bubbles – Natixis

FXStreet reports that the economic policy implemented in response to the COVID crisis has two major problems as it is leading to a sharp increase in companies’ debt and to asset price bubbles. According to Patrick Artus from natixis the ECB could have avoided these two problems by creating money in exchange for subscriptions to corporate capital increases.

“The economic policy implemented in response to the COVID crisis has two major problems. It is leading to a sharp increase in companies’ debt, which may jeopardise their capacity to invest and it is leading to asset price bubbles due to the extent of money creation when investors reinvest the money they receive in other asset classes. Once confidence returns, one should therefore expect a sharp rise in share prices and in real estate prices.”

“The ECB could have avoided these two problems and continued to support the financing of the economy by using a different method: subscriptions to increases in companies’ capital or quasi-capital (subordinated debt). The money creation would have been the same, but it would have had the corollary of increasing companies’ equity and not their debt.”

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Izvršenje trgovinskih operacija sa finansijskim instrumentima upotrebom marginalne trgovine pruža velike mogućnosti i omogućava investitorima ostvarivanje visokih prihoda. Međutim, takav vid trgovine povezan je sa potencijalno visokim nivoom rizika od gubitka sredstava. Проведение торговых операций на финанcовых рынках c маржинальными финанcовыми инcтрументами открывает широкие возможноcти, и позволяет инвеcторам, готовым пойти на риcк, получать выcокую прибыль, но при этом неcет в cебе потенциально выcокий уровень риcка получения убытков. Iz tog razloga je pre započinjanja trgovine potrebno odlučiti o izboru odgovarajuće investicione strategije, uzimajući u obzir raspoložive resurse.

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