Central banks expanding their balance sheets by flooding banks with reserves may not always increase liquidity. While this process usually boosts future liquidity availability, during times of stress, the demand for liquidity can exceed available reserves. Some banks may hoard reserves in stressful times, worsening liquidity shortages. This means that expanding central bank balance sheets through commercial banks may not prevent liquidity crises and could even make them worse, potentially dampening the positive impact on economic activity.