Or at least, it’s not working in the way that it’s being made out to.
If the objective - or rather, objectives - of the world’s governments through their suite of emergency financial measures is to sustainably normalise markets and stabilise the world economy, then they are palpably failing.
What the bailouts are doing is bailing out: at an incredible rate. The headline result of that is a normalisation, but of course, it’s artificial. The real test of the success of the bailout would be working out what would happen if you took it away again.
[Note: examples--with detail and very large numbers--omitted in the interests of brevity]
Here’s a part philosophical, part-hypothetical and part-sincere conclusion:
The problem with all of the current liquidity measures - in the US and abroad - is the same as that with the Fed’s other lending facilities: those like the TAF or the PDCF, which have been in operation for over a year. The facilities do not restore confidence, they simply nurture dependence.
To wit: the Fed isn’t de-risking the market, it is merely undercutting the risk appetite of all the market’s other participants, and in doing so only further damaging the likelihood of them participating again.