Posted on 10/22/2011 9:53:45 AM PDT by DeaconBenjamin
No more than usual is finding its way into my wallet. I wonder where it all is?
Well, you certainly can’t get a loan for a small business.
Inflation to follow
If V is down, you’ve got to push up M to get some inflation!
It’s also possible that people are switching assets in these times of suppressed interest rates, and that may be affecting the money supply measurement.
That the Euro Greasies converting their doomed fiat paper money to the soon to be doomed USD.
Think of it as a reprieve from the Governor but the execution is only delayed.
This more banker bailout through the back door. The value of everyone’s savings and purchasing power is being destroyed to pay for it.
or stagflation-better yet.
What is all this about? What does this mean and how does it affect me?
According to The Conference Board Leading Economic Index that’s a good thing...
“LEADING INDICATORS. Five of the ten indicators that make up The Conference Board LEI for the U.S. increased in September. The positive contributors – beginning with the largest positive contributor – were interest rate spread, real money supply....”
http://www.conference-board.org/pdf_free/press/TechnicalPDF_4316_1319103291.pdf
Beats me.
However, this is not necessarily a harbinger of inflation. This is far more likely a sign of the contraction of economic activity as folks deleverage and move to cash.
Obama’s off shore accounts.
Most people dont know what M2 is
I know M1 is cash + demand deposits, but I admit I forgot what M2 is
Can you help educate some of us freepers?
The Fed, with its ridiculous zero-interest-rate policy, and a trillion dollars of excess reserves in the system, has set up a potential inflation monster that they might not be able to control when it gets loose...and it might already be loose.
Furthermore, Bernanke has bought up trillions of dollars of long-term debt, and has been showing profits on it as he drives long-term interest rates closer and closer to zero.
But if the inflation rate heads to double digits, and it very well could, and sooner rather than later, the Fed’s bond portfolio is going to take a hit like it’s never taken before, to the tune of hundreds of billions of dollars in losses. Only problem is, the Fed’s losses are the taxpayers’ losses, so here we go again...
Anyone owning a long bond paying just over 3 percent in this environment should have his head examined. Unfortunately, even though the Treasury has been wise enough here to extend the maturity of the public debt by marketing longer maturity securities, Bernanke has been undoing that strategy by buying it all back. Pathetic, and we’re all going to pay dearly for it when his strategy implodes.
Meanwhile, Obama’s trillions in borrowing will be rolling over at double-digit interest rates that, again, we taxpayers will be on the hook to pay. But, in the end, it will no doubt all be Bush’s fault.
I’m far from an expert, but as I understand it, if the government pumps too much money into the economy too fast, you get inflation; i.e., the value of the dollar declines.
Obama or the Fed could make everyone holding cash dirt poor in a hurry just by printing tons of money. It’d be like Zimbabwe... millions of dollars just to buy a loaf of bread. A great way to redistribute the wealth. No act of Congress needed.
M0: The total of all physical currency, plus accounts at the central bank that can be exchanged for physical currency.
M1: The total of all physical currency part of bank reserves + the amount in demand accounts ("checking" or "current" accounts).
M2: M1 + most savings accounts, money market accounts, retail money market mutual funds, and small denomination time deposits (certificates of deposit of under $100,000).
M3: M2 + all other CDs (large time deposits, institutional money market mutual fund balances), deposits of eurodollars and repurchase agreements.
I wish we could go to Kinko’s copies and create instant wealth too. Trillions are being created by Obaba/Bernanke out of thin air. But beats me where it goes. Not into my pocket for sure. Wonder what kind of secret bank account some of our “leaders” have by now?
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