Going Forward, There Is No Debate: ‘The Balance Sheet Effect Is One Of Tightening’

For quite some time now, there's been considerable debate about whether it's the "stock" or the "flow" that matters when it comes to QE. There are good arguments on both sides, but common sense dictates that the flow should matter more precisely because the flow represents and ongoing incremental bid by a largely price insensitive buyer, whereas the stock simply represents the sequestration of assets on CB balance sheets. The latter is obviously supportive, but not nearly as much as the former.