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It is a last ditch effort to save the dollar from collapse.
Fiat means faith because with out that your fiat is not worth jack!
We are now in the final death spiral of the dollar. We don't even have the money to lend to FDIC, the FDIC is saying, "we want you (the US government) to borrow 500$ billion then let us borrow that 500$ billion" Of course, where does the Us government borrow money? By issuing bonds! If bond investors don't lend the money the fed buys it. How does the fed buy it? By printing up more fiat! Which of course dilutes the value of the existing supply of money. Which causes people to once again, lose faith in their fiat. When that happens, what do people do? Rush to the bank to withdraw their money. Which of course, causes the never ending spiral.
Of course for the longest time, we've had china bail us out a long with many other foreign nations. Now that the world is in a crisis, do you really think they are going to rush in and buy our bonds? Don't think so!
All the Federal Government is doing is putting of the inevitable. Last year they told us this was going to be short lived and the market would begin to rebound. What a pack of lies. How can the government bail out the government? Soon our dollar with be worth nothing. This can be nothing short of an early depression.
It is a last ditch effort to save the dollar from collapse.
Fiat means faith because with out that your fiat is not worth jack!
We are now in the final death spiral of the dollar. We don't even have the money to lend to FDIC, the FDIC is saying, "we want you (the US government) to borrow 500$ billion then let us borrow that 500$ billion" Of course, where does the Us government borrow money? By issuing bonds! If bond investors don't lend the money the fed buys it. How does the fed buy it? By printing up more fiat! Which of course dilutes the value of the existing supply of money. Which causes people to once again, lose faith in their fiat. When that happens, what do people do? Rush to the bank to withdraw their money. Which of course, causes the never ending spiral.
Of course for the longest time, we've had china bail us out a long with many other foreign nations. Now that the world is in a crisis, do you really think they are going to rush in and buy our bonds? Don't think so!
The slow death spiral.
There are a lot more banks that will be failing in 2009.
It is required becauswee it is likely that many more smaller banks will go undere just as in the 80's and the FDIC fund would not be enough,this isn't the 80's and the amounts are not the same.
It is required becauswee it is likely that many more smaller banks will go undere just as in the 80's and the FDIC fund would not be enough,this isn't the 80's and the amounts are not the same.
There is no inflation now;what you been reading. Inflation will be a problem when the econmoy starts to recover with the interest rates so low and the deficit so high IMO. The fed has the best info but like the case most times it will be late in raising interest rates to control inflatrion.
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