When the pandemic hit, central banks stepped in, providing easy access to money and propping up economies around the world.
In policy terms it was effectively a repeat of the prescription used in the Global Financial Crisis a decade earlier. But this has been a different kind of crisis. Consumer demand has held up. Inflation is looming as a serious threat.
Meanwhile, longer-term issues that the cheap money creates — such as rising debt and asset bubbles — are still unresolved.
A sense of unease with reliance on the central bank magic to solve our economic woes is reflected in the Mood of the Boardroom survey results. Business leaders were divided in their support for the Reserve Bank's monetary policy response to the pandemic.
The Herald survey asked: Has the Reserve Bank mishandled quantitative easing and fuelled an asset (house) boom?
The responses were evenly split.
The results showed 35 per cent say "yes" and 35 per cent "no". A large proportion — 30 per cent — were unsure.
It is, to be fair, a complex question.
Even the Reserve Bank (RBNZ) has acknowledged the role that low interest rates and Quantitative Easing play in driving up asset prices.
But was there ever any other option?
The RBNZ's quantitative easing (bond buying) was officially called the Large Scale Asset Purchase (LSAP) programme.
The programme had the potential to buy up to $100 billion of NZ Government Bonds, Local Government Funding Agency (LGFA) Bonds and New Zealand Government Inflation-Indexed Bonds in the secondary market by June 2022.
But the strength of New Zealand's economic recovery allowed the Reserve Bank to call time on it early.
When the programme was halted in July 2021, about $53b of bonds had been purchased. By comparison the US Federal Reserve has added about US$4 trillion to its balance sheet due to asset purchases since March 2020.
It has indicated it will start to "taper" or curb the pace of purchasing from November.
The aim of the LSAP programme was to lower borrowing costs to households and businesses by injecting money into the economy.
When the Reserve Bank buys assets, this increases their price and so reduces their yield. That means the interest rate, in this case on government bonds, falls. This had the effect of "lowering the tide" on other interest rates in the economy, particularly longer-term interest rates of two years or more. It also reduced the cost of borrowing for households and businesses.
Secondly, when the Reserve Bank buys government bonds, it encourages the sellers of assets to use the money they received from us to switch into other financial assets like company shares, bonds, or new lending — helping to inject money into the economy.
On the first measure the LSAP programme has been a clear success, ensuring interest rates have remained low. But as has been the case in almost every other comparable economy in the world the money has overwhelmingly flowed into the housing market.
Some business leaders who answered yes to the question, like Datacom's Tony Carter, saw the issue in that global context. "I think central banks globally have over-stimulated economies which will have huge long-term consequences particularly for future generations," Carter says.
"Sometimes there has to be a bit of pain and you just can't keep kicking that can down the road indefinitely."
Attempts to pull back on — or taper — bond buying in the US are inevitably met by a negative market reaction which puts pressure on their central bank to moderate its pace.
Others who answered "yes" were also sympathetic to the global dilemma. "Yes, but they are not alone — the world over we have seen central banks over-stimulate economies," said one senior director.
Conversely some of those who answered 'no' to the survey question wanted to highlight that, though they recognised issues around asset price inflation, they didn't see blame lying with the RBNZ.
"It has unfortunately been handed a dual inflation fighting and employment maximising mandate by this government. We are now seeing the inequitable impact of that folly," said Craig Stobo of NZ LGFA.
As the comment suggests, our Reserve Bank is ultimately bound by its mandate, which is set by the Government.
Carol Campbell, independent director with T&G Global, answered no to the question. "The quantitative easing has reduced job losses — which was important," she said.
"The constant media focus on owning a house and first home house purchase has fuelled panic in demand — which has fuelled prices."
Others felt the asset boom was an unavoidable side effect of a necessary policy move. "There is no doubt QE has contributed to the house price boom, but it's hard to say it was mishandled — we didn't know what we didn't know back then," said one director.
"They have done the right thing in the situation of crisis — however this was not an unexpected outcome where those with assets have had their wealth accelerate ahead. This without assets have been left behind," said another.
BusinessNZ chief executive Kirk Hope — whose answer put him in the "unsure" category — summed up the mixed feelings of many business leaders right now. "Mishandled is an unfair characterisation, they wanted to support the economy and did so, the rebound was faster and bigger than expected and alongside fiscal stimulus fuelled asset prices — perhaps they could have responded to the conditions earlier."