“Bernanke is a student of the monetary mistakes made during the Great Depression. He’s the only one that is keeping things afloat.”
The only thing he’s doing differently is fueling inflation by printing money. Things will go about the same as in GD1, except in a couple more years a loaf of bread will be $10, while salaries stay about flat.
That’s how I see things playing out, at any rate.
Now, when velocity returns to normal rates (i.e. above 1.6) and the money supply is still as big as it is, then there will be inflation as you state. Bernanke knows this and will attempt to drain the excess liquidity. Timing is absolutely critical and it will be difficult. But if the fed had not supplied the dollars demanded, we would be in a much worse DEflationary position than we are in today.
It's the only way out of this now. Unemployment has depleted the tax revenues, and people are too broke for a tax increase. The government has spent the next few generations of money, so they're broke. China has cut off their welfare checks, because they already own us.
There is no money. Oboma spent the stimulus "slush fund" on left wing special interests that consume rather than produce.
The only way out is massive inflation. We're going to have to bail ourselves out. Oboma and the democrats have been a miserable, miserable failure.
I'm wondering what will happen when the democrats have no money to pay the bills for welfare base. What will their base do without the taxpayers money? Where will they live? How will they eat? Who will buy their clothes?
I see a massive crime wave in the future. There will be no free stuff for them unless they personally steal it.
I believe the housing crash was planned in advance to guarantee a democrat landslide in 2009. The increased gas prices put everyone over the edge, and Soroes is an oil speculator. What we're seeing now are the unintended consequences. The democrats thought they could "community organize" us and everything would go smoothly once the gas prices went back down. They assumed the Republicans would work twice as hard to earn, produce, and "save their country." It didn't happen quite the way they planned it.