The Federal Reserve, European Central Bank and others have created so much money to accompany unprecedented support from governments to fight the Covid-19 pandemic that the world is awash with cash. The combined fiscal and monetary stimulus efforts of the United States, China, the Eurozone, Japan and eight other developed economies have increased their aggregate money supply by $20 trillion in 2020 and 2021 to a record high. $102.5 trillion, according to data compiled by Bloomberg. This amount has already increased by another $1 trillion this year.

Call it the stealth central bank put. It is unprecedented in modern times that the amount of money circulating in the global economy and financial system has jumped 25% in two years. This excess liquidity should act as a cushion for markets and economies even as central banks begin to tighten monetary policy. Just consider emerging markets, which in the past would have been a glaring weak spot in times of crisis. Not anymore. At $3.89 trillion, the foreign exchange reserves of the 12 largest emerging market economies outside China are up from less than $2 trillion in 2009, according to data compiled by Bloomberg.

Although the global stock market as measured by the MSCI All-Country World Index is down about 8% this year and the Bloomberg Global Aggregate Bond Index has fallen 3.03%, the only market which eclipses either in terms of trading volume remained calm despite rising geopolitical tensions. Volatility in the $6.6 trillion daily currency market is about 20% lower than the average of data going back to early 2021, as measured by JPMorgan Chase & Co.

Much of the attention on what is happening between Russia and Ukraine has been on the fallout in energy markets, and oil in particular. Brent crude rose 2.5% on Tuesday to $97.77 a barrel at 12:01 a.m. in London, extending this year’s jump to 26%. West Texas Intermediate crude gained 2.12% to $93, taking its year-to-date gain to 24%. Prices haven’t been this high since 2014. Yes, Russia is a key oil supplier to the world, but fossil fuels are a declining part of the global economy. The International Energy Agency estimates that the share of oil in the global energy mix has fallen from 45% in 1974 to 31%. Moreover, the amount of oil consumed per unit of economic output has also fallen by a third since 2000.

And consumers are certainly feeling the impact of rising energy prices at the pump. The price of a gallon of regular gasoline has risen to $3.53, the highest since 2014, according to the Automobile Association of America. The thing to remember, though, is that, as my Bloomberg Opinion colleague Liam Denning pointed out, spending on gasoline and other fuels as a share of disposable income is about half of what it was during of the first decade of this century.

What would be concerning is if financial conditions were tight and are getting tighter, but that is not the case. Although the Fed has signaled its intention to tighten monetary policy by raising interest rates this year and shrinking its balance sheet by $8.91 trillion, contributing to weakness in stocks and bonds, the Bloomberg US Financial Index Conditions Index+ remains close to its lowest on record. This, again, should help cushion the fallout from the Ukraine crisis.

Let’s not forget that financial markets barely budged when Russia annexed Crimea to Ukraine in early 2014. The MSCI All-Country World Index fell 4.07% in January before rising 4 .65% in February and to register a gain of 2.10% for the year. . And that’s when the global money supply was only around $60 trillion, about 40% below current levels. As BlackRock Inc. strategists pointed out in a research note to clients on Tuesday, it’s normal for geopolitical tensions to cause short-term swings. What is not normal is that they become permanent drivers of the market. And if that turns out to be true again this time, part of the reason will be central bank stealth betting.

More other writers at Bloomberg Opinion:

• Investors are often the first victims of war: Niall Ferguson

• Currency options shrink as Ukraine fears rise: Mohamed El-Erian

• Biden’s response in Ukraine is mired in oil: Liam Denning

This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.

Robert Burgess is the editor of Bloomberg Opinion. He is the former global financial markets editor for Bloomberg News. As editor, he led the company’s news coverage of credit markets during the global financial crisis.