The DOW was down again today on news of weak retail sales and a low core inflation number and that has Ben Bernanke worried. He was out beating the drum again for more Quantitative Easing (that’s “printing money” for you English speakers). The Fed Chairman has his hair on fire over the idea that we will drop over the edge into a deflationary spiral. His determination to do something about it is making him less than popular with some people on Wall Street.
Most investors want to see a lot more free money since that will drive up the market but the ones that are sitting on trillions in cash waiting for the market to crash so they can buy for literally pennies on the dollar are steaming. They are calling Bernanke clueless and they are giving dire warnings about hyper-inflation. They are predicting runaway government since Congress doesn’t need to pay its bills with Bernanke printing money.
These critics (who are really just shills for people holding USDs) point to Bernanke’s admission that he is really in uncharted territory when it comes to printing this much money (he didn‘t put in such plain English). Of course the Weimar Republic of Germany comes to mind, they added 12 zeros to the Mark in just three years.
As scary as hyper-inflation sounds the opposite or deflation is the wealth destroyer for us peasants. Deflation works great for the wealthy, especially if they are prepared for it in advance by accumulating trillions in cash. If you have a mortgage or other debt, making your payments after a round of deflation has devastated the economy then becomes impossible and you find out the difference between being a peasant and a serf.
If the Fed is successful in creating inflation then the corporations holding that 3 trillion in cash will have no choice but to spend it and that could be good thing if it doesn’t get out of hand. That is of course the 64,000,000,000,000,000 dollar question (64 quadrillion dollar question) that’s the 64 thousand dollar question after you add 12 zeros for inflation. I heard a little guy down at the beer hall who says he knows who is to blame and he gave me this great brown shirt. www.prairie2.com
Most investors want to see a lot more free money since that will drive up the market but the ones that are sitting on trillions in cash waiting for the market to crash so they can buy for literally pennies on the dollar are steaming. They are calling Bernanke clueless and they are giving dire warnings about hyper-inflation. They are predicting runaway government since Congress doesn’t need to pay its bills with Bernanke printing money.
As scary as hyper-inflation sounds the opposite or deflation is the wealth destroyer for us peasants. Deflation works great for the wealthy, especially if they are prepared for it in advance by accumulating trillions in cash. If you have a mortgage or other debt, making your payments after a round of deflation has devastated the economy then becomes impossible and you find out the difference between being a peasant and a serf.
If the Fed is successful in creating inflation then the corporations holding that 3 trillion in cash will have no choice but to spend it and that could be good thing if it doesn’t get out of hand. That is of course the 64,000,000,000,000,000 dollar question (64 quadrillion dollar question) that’s the 64 thousand dollar question after you add 12 zeros for inflation. I heard a little guy down at the beer hall who says he knows who is to blame and he gave me this great brown shirt. www.prairie2.com