It's been 5 years since the Fed started QE and we haven't had big increases in prices so according to the "experts" this proves that printing money does not cause prices to rise. So my question is, what's the downside? Why don't we just crank up the presses and go all in is there's no downside?
Last edited by Madison320; 09-15-2014 at 03:15 PM.
Experts..
"He's talkin' to his gut like it's a person!!" -me
"dumpster diving isn't professional." - angelatc
"You don't need a medical degree to spot obvious bullshit, that's actually a separate skill." -Scott Adams
"When you are divided, and angry, and controlled, you target those 'different' from you, not those responsible [controllers]" -Q
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What was that???Originally Posted by dannno
How I feel about "experts"
"He's talkin' to his gut like it's a person!!" -me
"dumpster diving isn't professional." - angelatc
"You don't need a medical degree to spot obvious bullshit, that's actually a separate skill." -Scott Adams
"When you are divided, and angry, and controlled, you target those 'different' from you, not those responsible [controllers]" -Q
"Each of us must choose which course of action we should take: education, conventional political action, or even peaceful civil disobedience to bring about necessary changes. But let it not be said that we did nothing." - Ron Paul
"Paul said "the wave of the future" is a coalition of anti-authoritarian progressive Democrats and libertarian Republicans in Congress opposed to domestic surveillance, opposed to starting new wars and in favor of ending the so-called War on Drugs."
What would be the downside of you printing the money?
Am I to understand that you were under the impression that a "big increase in prices" was the only downside to printing/creating money?
And now that reality has proven you wrong in expecting that these "big increases" were inevitable and imminent, you no longer see any downside to printing money?
I think the banksters are planning on buying the rest of the world that they don't already own (on paper). I wonder how much that would take. They're locking up TRILLION$ from the Fed. What for, pray tell?
I was being sarcastic. I should've put "experts" in quotes. I absolutely still believe we are going to see big price increases. My point is that if according to the "experts" QE does not lead to a devalued dollar and prices increases, why not print as much as you want?
Well I can think of lots of reasons why not to do such a thing.
The "money" that's been printed isn't in circulation yet. When and if it does go into circulation, inflation will kick in big time.
That will depend on how fast the money goes into circulation and how fast it moves (velocity).
There is no down side to printing money unless you are caught, tried, convicted and executed.
It's complicated. The change in the money supply is not the only variable at work.
Currencies are a market like any other. So, for example, if the number of people / countries using your currency is increasing, then you could increase your money supply with little to no effect. This is especially true if people are hoarding the currency rather than using it. (All the countries with national reserves of dollars.) In this situation, not increasing your money supply could have detrimental effects on the currency as it would become less available/liquid over time. (This is less important if your currency is infinitely divisible like some cryptos.) Then you'd reach a tipping point where no one would want to use your currency anymore, and then things would go back the other direction. Not good.
This is one of the downsides to having a nation's currency be a popular reserve currency. Even if the central bank did not use monetary policy to try to affect the economy, it would still need to guess what the 'right' size of the money supply is/should be over time based on use and other factors.
Last edited by TheCount; 09-15-2014 at 09:32 PM.
whoever gets that money first will gain the most.
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you don't need to be an expert, you just need to be somebody other than hyperinflation alarmists who think every day is a ticking time bomb for money to be worth toilet paper and we must stock up on canned foods and ammo.
and prices HAVE risen, don't you read zerohedge.com, inflation.us, infowars.com, theeconomiccollapseblog and naturalnews.com?
the downside to printing money isn't realized until the money is spent. So why don't we just keep printing? First you have to acknowledge that the downside is already here.
I have my canned goods and ammo.
Tell you what. I'll make a bet with you. Every time I go buy some steak at the grocery this year, I'll pay you the difference if the price is down from 2009, and you pay the difference if it's up.
Is it a bet?
I've got a couple of those 100 trillion $ bills framed and hanging on my office wall. Maybe in a few years, I can buy Zimbabwe with them.
Well, yeah, but the downside is that then you own Zimbabwe.
I totally agree that prices are rising, and rising faster than the CPI, but they're not rising that fast yet. I'd say maybe 3 to 5%. But the real indicator to me are global commodities like oil and they haven't taken off, yet. Oil is down to the low 90s. I admit that it's taking longer than I expected for prices to rise, but I still believe it's going to happen unless we've figured out how to repeal the basic law of supply and demand.
The bottom line is that nobody is going to be convinced until it happens. It's hard even for me to imagine a dollar crash, but logically it's going to happen.
I have one , but mine has an expiration date.
I'll keep laughing at you for being constantly prepared for nothing.
Well the ammo is to help keep the laughing Hyenas away.
but canned food will attract them, that cancels out.
Just more meat for the table.
5 years of QE has basically destroyed the US dollar reserve status. All we're waiting on at this point is for a workable alternative to be implemented, and it's well under way.
Everybody knows that you need your currency to be the world's reserve currency to be that reckless with money printing. I bet if Zimbabwean dollar was the world's reserve currency
1. They wouldn't have needed to print that many dollars
2. The money printing will produce far less inflation that it would without a world reserve currency.
4 min. explanation of the problems with printing fiat currency.
No, Madison, what you're describing and what you believe in is the law of supply. Supply and only supply. You do not believe in the law of supply and demand.
No, you believe in miracles. We had this conversation before. I think at the time the monetary base had tripled so I said if you tripled (now it's over 5 times!!) the money supply, all things being equal prices will triple. You said something like "demand could also triple". Yeah, it could but is that likely? Especially if it's being printed like crazy. In reality, printing a currency is much more likely to cause demand for that currency to DECREASE. That would set up a double whammy where supply is increasing and demand is decreasing.
Like I said before, if you're right and we can print all we want without devaluing the dollar then we can all retire in style on social security. So either way I'm covered.
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