NEW YORK ( TheStreet) -- The diminishing marginal effect of QE's has been well documented on the blogosphere. Yet it was still a bit surprising to me to see the virtually non-existent effect of QE4. The market had completely priced in the expectation of QE4 days in advance, managed to feign mild excitement for an hour and half, and then proceeded to go back to fiscal cliff afterwards.This is quite extraordinary considering that QE4 did break some new ground in the history of central bank monetary policy, even after the historical perpetuity of QE3, by using unemployment rate as a benchmark.
Diminishing Effect of QE: Increasing Exit Risk
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