The idea that central banks would write off parts of their massive debt holdings seemed pretty outlandish when we discussed it in March 2020, which is why it was surprising to see it discussed this week in a Financial Times op-ed. Securities finance professional have a stake in the outcome of this debate: central bank debt forgiveness would be a good move back to normalcy in monetary policy, which in turn should mean a return to more price discovery in financial markets and an end to “everything bubbles”. That in turn is good for business.
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