How Fed's QE Created a $5.13 Trillion "Excess Liquidity" Pool, Decoupling Money from the Real Economy

The Federal Reserve's quantitative easing has fundamentally altered money creation. While bank loans traditionally drove deposit growth, post-2008, the Fed's asset purchases injected massive reserves directly, spawning trillions in deposits unlinked to private credit. This created a $5.13 trillion "excess liquidity" pool, historically decoupling broad liquidity from real economic lending.

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