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.
I love this guy, always working for poor and middle class people
These bizarre stuff always starts from Japan and HM is no exception
Quote:
But despite Bernanke's insistence to keep his mouth shut about what transpired during his historic meeting, the answer leaked out anyway: Koichi Hamada, a close adviser of the prime minister, said Mr. Bernanke may have discussed helicopter money with Japanese officials he met with during his visit, including BOJ Gov. Haruhiko Kuroda and Ministry of Finance policy makers. Hamada, a Yale University professor, attended Tuesday’s meeting with Bernanke and Abe.
As a reminder, Mr. Bernanke said in a blog in April that monetization by a central bank could be the “best available alternative” under extreme circumstances, for example when demand is very weak but a central bank is out of ammunition and parliament is unwilling to rely on borrowed spending.
And just like that, the final phase of monetary policy - incidentally a very familiar one to the Weimar Republic - is about to begin, with helicopter money first coming to Japan, to be tried out as a trial balloon, and then everywhere else.
Old news, the U.S. did something similar under Bush in 2008 (when Bernanke was Fed chair). Everybody who filed a tax return in 2007 got an Economic Stimulus Payment direct deposited into their checking account or was mailed a check. People can quibble about terminology and call it a tax rebate, but IHMO it's indistinguishable from helicopter money.
It was very different from helicopter money. The stimulus checks were borrowed against the US balance
sheet and are part of our national debt. Helicopter money would send QE money directly to the
consumer with no strings attached and without the need of applying for a loan to get a piece of it (as
has been the case with QE up until now). It would not increase the national debt, only the Fed's endless
money supply.
The idea is very interesting but it begs the question, what is money if it can be had in exchange for nothing?
... It would not increase the national debt, only the Fed's endless
money supply.
...
It was my impression that QE simply drives up the fed balance sheet rather that the treasury debt. Seems to me that it is just a federal government liability in a different form. No new magic, just new political speak.
Only in the big picture. No value gained, and thus, the currency weakens. But the money is redistributed, and that can have a huge effect on demand, depending on where it goes. If it was given to the consumer base like a basic income, it would in effect be like taxing the rich and giving to the poor.
It was very different from helicopter money. The stimulus checks were borrowed against the US balance
sheet and are part of our national debt. Helicopter money would send QE money directly to the
consumer with no strings attached and without the need of applying for a loan to get a piece of it (as
has been the case with QE up until now). It would not increase the national debt, only the Fed's endless
money supply.
The idea is very interesting but it begs the question, what is money if it can be had in exchange for nothing?
This is where the Fed, Congress, or some other agency of elected officials, would create our money de novo and sans debt.
Money can be created by sovereign entities as is fiat, unconstrained or based on any commodity like gold.
It was my impression that QE simply drives up the fed balance sheet rather that the treasury debt. Seems to me that it is just a federal government liability in a different form. No new magic, just new political speak.
So far QE is new money swapped for debt, dollar for dollar. When it is swapped for Treasuries, that is national debt.
The Fed holds about $2.5T of that debt, and sweeps about all of its related interest gains back to the Treasury and we the people. So interest obligation wise, our national debt is effectively that much lower.
Of course we all know a USD can be freely exchanged for a dollar's worth of about anything one might want.
The value is in the full faith and trust of our people, rule of law, national productivity, security and stability.
No quick and easy feat anywhere.
Of course it is also fact that inflation erodes just how much stuff that USD will buy at any point it time. A similar process going on all over the world with modern moneys and economies. And so far that has been acceptable enough and/or preferred over the inverse, meaning persistent deflation. But more lately without the accompanied wage inflation in the developed world, we are seeing repercussions.
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.
