Monetary authorities across the world have poured out huge quantities of money to the point of even negative interest rates. Yet, despite this there has been minimal inflation and economic growth.
What is happening so that this vast money supply has not been economically productive? This is reminiscent of the 30s where monetary policy seemed to fail.
“What is happening so that this vast money supply has not been economically productive?”
A number of things have combined for the perfect economic storm. Technology has overcome some of the older economics that says cheap labor rules manufacturing. You can get a machine or a program to do almost anything that formerly took either specialized knowledge or an hourly worker. This has resulted in much less employment at the same time governments are forcing employers to pay more to have employees in the form of taxes, like unemployment “insurance” and medical costs. At the same time we hit a depression with mostly liberal governments. Liberal governments are, by their nature, anti-capitalist. Companies are sitting on their investment capital waiting for the return of law so governments won’t sweep in and take their profits. In American companies alone there is an estimated fifteen trillion dollars sitting in cash waiting for Obama to leave office. Other factors are a general contraction in the world economy and a huge over investment in infrastructure and capacity in places like China. This will drive down prices and investment for the next fifty years. (China can make more steel, for example, than the entire rest of the world. What does that do to prices and investment in steel mills in, say America or Canada?) At the same time the middle east is on fire and flooding the world with new immigrants who know nothing that can make them productive. This will hold down employment, along with the Hispanic rush to American shores, for decades.
In short, there are too many unqualified people, too much infrastructure, too many already built structures in the US and China, so where can the economy begin to recover? Manufacturing? Once you have a car, two cars, three cars and two, three or four TV’s and everybody has an iPhone, what do you manufacture?
On top of that we are just entering an era of robotics. Oh, joy.