They may choose to invest the money in assets in other countries which would lead to a lower exchange rate. [12] So bond purchases work through a number of channels to put downward pressure on interest rates for the government, households and businesses, as well as downward pressure on the exchange rate. There is also another important channel by which bond purchases operate.
The engine of trade, which powered the global economy in the 1980s and 1990s, has also weakened considerably. Gains from better education and health have been diminishing as improvements in education and health care systems go abegging for lack of investments.