Bank of Canada Assets and Liabilities - You Should Be Worried
(media.omegacanada.win)
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Can someone explain this to me?
I understand from a business perspective and an accounting perspective that a corporations ASSETS = LIABILITIES + SHAREHOLDER EQUITY.
What does this show from a national economic perspective? (If i do A - L = SE then this chart makes no sense at all)
Money isn’t an asset to the central bank, it’s a liability. So their assets going up means their liabilities (money) has also sharply increased.
So this means big inflation?
Yes and no. A lot of that money was used to buy up bonds an debt such as mortgage securities. So the money isn’t in the system directly, it’s used to keep the sinking ship afloat. But that money will get into the system eventually, so yes, inflation is coming, just not this minute.