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QE has not been inflationary because the new money created does not enter the general circulation. And not only doesn't QE add money to the general economy, it essentially removes a great deal of interest income from the private sector, which has to be deflationary if anything. One major reason to even have QE is to stimulate some inflation, so in that sense it has failed.
I am sure you know more than I that the QE money was NEVER in any shape or form to save the real economy by now
liberals and conservatives with any sense of intelligence should recognize that the QE was to BAIL OUT THE elite classes more than anything as well as the insiders that benefit from this.
it is just more criminal behavior from the elites that need to be hung and have all their assests siezed for conducting terrorist behavior. more than anything
major banks
laundering drug money
laundering for terrorists
funding terrorism.
funding drug lords
market manipulation LIBOR.
market manipulation in general by the market makers
HFT- high frequency trading.
Please note the elite class is not simply being rich in money
but those with connections and pull strings behind the scenes of society are the elite class.
Rich people should know the difference and I am sure some are trying to break into the club and join them to be protected
Actually, if you look at it more fundamentally, you'll see why this is wrong.
150 years ago, you could get into any business you wanted without anyone to stand in your way. Further, there was almost nothing anyone could do, to obstruct you. Oh, there were local examples of public corruption, where governments acted at the behest of certain influential people, but as a whole, there was simply no way to forcibly "protect" yourself from competition, other than hired thugs or other criminal behavior.
Today, everything is so regulated, and so tightly locked down, that if you want to do something outside the status quo, your biggest obstruction is public authorities.
The change is not that people don't want to protest. It's that in the past, change came about simply by people doing what they should do, and not needing to try to protest government into directing change.
This is exactly the problem with government regulation.
one cannot even open a lemonade stand now without getting arrested.
what is wrong with vendors opening shop and selling
or making their goods in their homes and raising livestock in apartments?
those things that save a common person money ARE all ILLEGAL or restricted.
or how about having taxi cabs? you now need licenses that is worth millions on the black market
seriously the government is making commerce too expensive in general.
they make opening any small business hell nowadays because they want to protect big business and let small businesses take up the ones big business does not want to be a part of because of paper thin margins.
what is wrong with selling hot dogs without government permission eh?
morally and logically speaking NOTHING.
but it is against the law.
QE has not been inflationary because the new money created does not enter the general circulation. And not only doesn't QE add money to the general economy, it essentially removes a great deal of interest income from the private sector, which has to be deflationary if anything. One major reason to even have QE is to stimulate some inflation, so in that sense it has failed.
QE is not inflationary because Keynes was right. Large increases in the money base are not inflationary in a liquidity trap.
The failure of large increases in the monetary base to have an inflationary impact was fully predicted, in advance, by simple economic models that have been around for decades.
While you call receiving low interest rates on bonds deflationary, you ignore the stimulative effect of businesses and consumers able to borrow at record low interest rates. High interest rates, such as existed in the early 1980s, slammed the breaks on the economy, in order to control inflation. That example alone is enough to debunk your theory.
QE is not inflationary because Keynes was right. Large increases in the money base are not inflationary in a liquidity trap.
The failure of large increases in the monetary base to have an inflationary impact was fully predicted, in advance, by simple economic models that have been around for decades.
While you call receiving low interest rates on bonds deflationary, you ignore the stimulative effect of businesses and consumers able to borrow at record low interest rates. High interest rates, such as existed in the early 1980s, slammed the breaks on the economy, in order to control inflation. That example alone is enough to debunk your theory.
I haven't ignored the stimulative effect of low interest rates on borrowing. Heck, I and my kids are doing exactly that. I have been able to borrow at low rates and invest and get higher rates of return. My kids recently bought a house at the nadir of recent rates. But the fact is that the banks haven't been doing much lending. They are getting rewarded to sit on money, and they have few good risks asking for loans. When they begin to lend out in more significant volume, that's when the QE needs to be unwound.
It is too late to unwind QE. There are hundreds of trillions of dollars floating around as derivatives. The six largest banks who have been blessed with "too big to fail" status know this, yet they carry these derivatives as "assets". They are not assets. It is impossible to pay the simple interest on our debt, much less any of the principal. Government is spending 42% more than it takes in. When I began in real estate about 15% of mortgages were guaranteed by the government. Now it's 99%. No rational board of directors would expose their bank to the typical mortgage in these times.
In 1913 you could buy a cow with a $20 gold piece. Today you can buy a cow with that same gold piece, but a $20 bill won't get you very far down the meat counter. What has changed? Not the value of a cow or the $20 gold piece in real terms; What has changed is the value of Federal Reserve notes. The more they print out of nothing, the lower the value in real terms.
As Keynes said, "in the long run, we're all dead." That's why dealing with the problem at hand is critical. If we have inflation in 10 years, we'll use economic tools that deal with inflation, then.
This is easily one of the most shortsighted, foolish things I have read in a while. I sincerely hope you don't actually believe this.
You are honestly OK with the liability side of the Fed's balance sheet right now?
despite what a poster a few replies up said, people could not do whatever they wanted 150 years ago. In 1863, many people were enslaved. Many more had been conscripted into fighting in the Civil War.
I don't think that's a fair rebuttal, since he didn't mean that at all. The slavery question was a different issue than what he's discussing. Certainly, you are correct in saying not everyone could do what they wanted to do, but that goes toward another point. Namely, it's a shame that the founders didn't see to it that the blessings of liberty were bestowed upon all, as they claimed to desire. And, it's also true to say that slaves weren't the only people who couldn't "do what they wanted" in the broadest sense of the word. And in some cases, that's a good thing.
It is too late to unwind QE. There are hundreds of trillions of dollars floating around as derivatives. The six largest banks who have been blessed with "too big to fail" status know this, yet they carry these derivatives as "assets". They are not assets. It is impossible to pay the simple interest on our debt, much less any of the principal. Government is spending 42% more than it takes in. When I began in real estate about 15% of mortgages were guaranteed by the government. Now it's 99%. No rational board of directors would expose their bank to the typical mortgage in these times.
In 1913 you could buy a cow with a $20 gold piece. Today you can buy a cow with that same gold piece, but a $20 bill won't get you very far down the meat counter. What has changed? Not the value of a cow or the $20 gold piece in real terms; What has changed is the value of Federal Reserve notes. The more they print out of nothing, the lower the value in real terms.
This is exactly the problem with government regulation.
one cannot even open a lemonade stand now without getting arrested.
what is wrong with vendors opening shop and selling
or making their goods in their homes and raising livestock in apartments?
those things that save a common person money ARE all ILLEGAL or restricted.
or how about having taxi cabs? you now need licenses that is worth millions on the black market
seriously the government is making commerce too expensive in general.
they make opening any small business hell nowadays because they want to protect big business and let small businesses take up the ones big business does not want to be a part of because of paper thin margins.
what is wrong with selling hot dogs without government permission eh?
morally and logically speaking NOTHING.
but it is against the law.
It is encouraging to know that others are finally understanding how things really are. What started as "protecting the people" was really meaning "protecting the well connected". This has closed the door to much innovation and competition, thus making the economy a shrinking pie.
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