Except that actions like QE and QT (if the Fed ever really does the latter) are major market distortions. Interest rates have been artificially low since 2008/2009, and arguably since 2001.
Broadly speaking, that is true. However, QE and QT (if it happens) are more targeted at the overall money supply--the focus there is overall liquidity (which is related to but distinct from interest rates). Thus, those programs, while, as you point out, are hugely distorting, are still part of the paradigm of the securities marketplace.
Delving into the particular ramifications of both easing and tightening, while itself a worthwhie exploration, would probably have exceeded the email length for the article!
> The generic answer is simply “market forces”.
Except that actions like QE and QT (if the Fed ever really does the latter) are major market distortions. Interest rates have been artificially low since 2008/2009, and arguably since 2001.
Broadly speaking, that is true. However, QE and QT (if it happens) are more targeted at the overall money supply--the focus there is overall liquidity (which is related to but distinct from interest rates). Thus, those programs, while, as you point out, are hugely distorting, are still part of the paradigm of the securities marketplace.
Delving into the particular ramifications of both easing and tightening, while itself a worthwhie exploration, would probably have exceeded the email length for the article!