Posted on 01/26/2009 7:09:49 PM PST by sickoflibs
I’m speaking metaphorically. It’s an analogy. Perhaps you’ve heard of them.
Use small words, he's slow.
The Fed doesn't need to physically print bills, regardless of denomination. Remember, they have legal authority over many areas of monetary policy, including increasing the money supply via these types of inter-bank transactions. The old way was to print money and hand it out; now they just make an electronic entry.
I'm not sure whether Mr Todd is in favor of this type of central banking power, since he seemed to rather enjoy tweaking your lack of knowledge in this area rather than debate the question of "is it good and/or right"?
Travis, the issuance of new Treasury/agency bonds increases the level of interest bearing federal debt. This is the fiscal (Keynesian) side of economic policy ie the "No Pork Left Behind" bill currently before Congress.
The Fed is charged with managing monetary policy via interest rates & money supply. The primary complaint with them is that an entire world economy is dependent on Bernanke & Co getting it just right between inflation & depression.
The secondary, more paranoid issue, is that the Fed and various broker/dealers and other financial institutions are engaged in self-dealing. For example, charges that Paulson engineered TARP I to help out his buddies and enrich himself.
The third complaint is that Bernanke is really pushing the Constitutional envelope in terms of what his powers are with regard to the 1913 Act. Right now, it seems like the politicians are simply clueless and are hoping he has all the answers.
All your self-described bad ideas are rooted in one bad idea which is not allowing the market to determine a reasonable amount of lending. Slowing down the massive deleveraging can be done without trying to pump new loans - it just requires traditional Fed loans with somewhat longer terms. The market is going to have to be allowed to properly price loans, the longer that is postponed, the worse the inevitable contraction (or hyperinflation) will be.
Wow... Just...
Wow...
Here’s the problem... Just creating more FRN’s does nothing to help the economy. All it does is devalue the means of exchange making things worse. Zimbabwe prints money by the mega-ton and it’s worth less once the ink is dry than when it was still blank paper.
The Fed creates money by bookkeeping entry.
When there is a sudden jump in demand for dollars, the Fed helps the economy by being the lender of last resort.
Be careful. They have torches and pitchforks and know where the smart people live. LOL!
The gold standard will be restored
People create wealth by making and selling things. The means of monetary exchange is moderated by the Fed. The Fed “makes” nothing. It does however devalue the our legal tender by just “printing” more bills backed by nothing.
Unless you like paying $140 for a loaf of bread? We could get that bad if they keep doing this.
The Fed doubled its balance sheet since last summer. Did prices double? What did oil and gas do when the Fed "printed" all this new money?
How is "lending" money considered "inflation"?
Hey... looky there! Inflation grew. Nice going Ace...
Lending money based on nothing doesn’t inflate? Wow... You need to re-write the text books.
That's inflation?
I just lent my brother $20. How much inflation did I cause?
No... that’s the price of a barrel of oil and a straw man. Focus... Take your Ritalin and try again.
Now head over to your printer, make 3 copies of that same $20. That's inflation.
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