Dr Sam Wylie

So the interest rates were cut to zero, essentially.

They were cut to 0.1%, which is so close to zero.

Let's just call it zero.

And that wasn't enough.

So the image you should have in your mind is the governor of the Reserve Bank, Philip Lowe, pulling the lever down.

And it's not enough.

It's not speeding up the economy.

The economy is still falling into the abyss in February and March of 2020.

So then he thinks, OK, well, what else can I do?

And what he can do is create new money.

to try and stimulate demand and stimulate inflation, because he's very worried about a deflationary spiral, a spiral downwards where prices start to fall and companies aren't earning enough to pay their workers, and then workers aren't spending, so prices fall even more.

He's very worried about a deflationary spiral.

He wants inflation.

He wants to increase demand.

He's pulled the lever down as far as he can.

What's he going to do next?

He's just going to create money.

create new money.

And they do that.

This is quantitative easing.