Reid: Reflation Instability Fear 'Vexing' to Markets

The video discusses market instability and the role of central banks in stabilizing the financial system. It highlights the impact of central banks' policies on market stability and the potential transition to different policies. The ECB's current strategies and potential changes are examined, along with the review process and its effects on markets. The video also explores the impact of the QE program on the corporate credit market and borrowing costs, noting differences in corporate behavior between Europe and the US.

What is the main concern if central banks decide to store up ammunition?

• Increased market stability

• Potential market instability

• More economic growth

• Higher inflation rates

What is the ECB's likely course of action regarding the QE program?

• Reduce the program significantly

• Increase interest rates

• Extend the program in December

• End the program immediately

Why might the ECB be reviewing its current policies?

• To reduce government debt

• To address potential side effects

• To increase bond yields

• To align with US policies

How do European companies generally respond to lower borrowing costs?

• By increasing M&A activity

• By remaining conservative

• By buying back shares

• By aggressively expanding

What is a significant difference between European and US companies in response to QE programs?

• US companies are more aggressive in share buybacks

• European companies engage in more M&A

• European companies have higher borrowing costs

• US companies are more conservative