http://economicsonline.co.uk/wordpress News, Comment, Theory Tue, 25 Oct 2011 22:25:52 +0000 hourly 1 http://wordpress.org/?v=3.3.2 http://economicsonline.co.uk/wordpress/?p=2203#comment-323 Percival Thomas Tue, 25 Oct 2011 22:25:52 +0000 http://economicsonline.co.uk/wordpress/?p=2203#comment-323 Am I right in thinking that an increase in QE is really an increase in the old money supply?. And how effective is QE in increasing Aggregate Demand? Consumption is the main part of aggregate demand, so consumers want money in their hands to spent, especially those with high Marginal Propensity to Consume. Give these consumers a about £200 for Christmas and let them spend to help business in the UK. But we have a high Marginal Propensity to Import. At least we will get some spending. Am I right in thinking that an increase in QE is really an increase in the old money supply?. And how effective is QE in increasing Aggregate Demand? Consumption is the main part of aggregate demand, so consumers want money in their hands to spent, especially those with high Marginal Propensity to Consume. Give these consumers a about £200 for Christmas and let them spend to help business in the UK. But we have a high Marginal Propensity to Import. At least we will get some spending.

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