Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
lol. Poor Lord Bot thinks he can rationalize printing money to buy treasuries by denying it now.
Without that money, treasuries would be sold on the open market and interest rates would be in the double digits.
And it IS getting into the economy via deficit spending.
Uh, yeah, right...like there was not deficit spending before QE.
Whether there's deficit spending or not has nothing to do with whether or not QE money gets into the economy.
There's no need for me to "rationalize" anything. The reality is what the reality is - there's no significant inflation because QE is not "printing money", it's simply a means of holding down interest rates while the economy continues to heal.
Will interest rates rise after QE ends?
Of course they will.
Will they be "double digits"?
Nope.
There IS no true "open market" for interest rates - and there has been none for decades. The FED pretty much determines interest rates. The Fed sets the baseline and there's some slight variation from that baseline that's driven by the private sector - but that's it. The vast majority of control over interest rates is driven by the Fed - so no, interest rates would NOT be "double digits".
CBO projections mean nothing beyond 2013 as they are not allowed by law to take into account what people will do when their taxes hit them hard, or when obamacare really gets going. the CBO can only look at static economic models, not dynamic ones. i hope that this lowering of the deficit lasts, i fear it wont though. we shall see.
Which is why they are released annually....
Quote:
actually it was the republicans that drove the budget cutting, and the dems constantly hampered the efforts. enough dems finally came on board and the budget cutting began. if this continues it will ultimately be a win for the american people, but both parties have egg on their faces and mud in their pockets.
Actually it was both parties that put us into this mess and the deficit declined in spite of Republicans and Democrats. Higher revenue from an improving economy and lower social net spending for the win.
QE is NOT "printing money" - that's just more ignorant nonsense.
"...So we can see that while the central bank's balance sheet does expand, the only impact in the private sector is to change the composition of the banks' balance sheets, exchanging bonds for reserves. The total assets of the private sector don't change. Hence no money is being created any more than, say, if someone sold their stocks and put the money into bonds...."
Actually it was both parties that put us into this mess and the deficit declined in spite of Republicans and Democrats. Higher revenue from an improving economy and lower social net spending for the win.
Yup - the vast majority of QE money does NOT get pumped into the economy, that's why there's been almost no inflation and there will BE almost no inflation. Likewise there will be NO huge collapse of the stock market. As we saw when it was announced that QE would be ending soon, the stock market took a bit of a hit (but not even enough to wipe out THIS years gains, let alone those for the last few years) while gold got crushed.
Yup - the vast majority of QE money does NOT get pumped into the economy, that's why there's been almost no inflation and there will BE almost no inflation. Likewise there will be NO huge collapse of the stock market. As we saw when it was announced that QE would be ending soon, the stock market took a bit of a hit (but not even enough to wipe out THIS years gains, let alone those for the last few years) while gold got crushed.
Ken
The fed props up the GSE's via QE, which now underwrite or hold most of the mortgage paper. They have a stated exit strategy of selling mortgage-backed securities to regular investors. Hmmm...
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
