They don’t care about the coming high inflation caused by Quantitative Easing (printing money) — Krugman calls it The Inflation Obsession
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I’m not so sure the USA is going to get that inflation caused by Quantitative Easing (printing money). Not with the USA producing an extra million barrels @ day for the last three years and officially slated by the IEA to do the same thing again in 2014 and 2015. (and unofficially through 2018,)
More USA oil reroutes capital flows around the world to the benefit of the dollar. That’s why despite Quantitative Easing (printing money)for the last three years the dollar has gone sideways. The downward pressure on the dollar of QE has been met with upward pressure on the dollar by rising oil production—(rising oil production has clipped an average of an extra 100 billion annually off the federal deficit for the last three years. Three year from now that number will go up to 200 billion as growing oil drilling adds more money to federal coffers. In addition to that rising oil production shrinks the trade deficit. And will continue to do so.
The value of the dollar is a function of the future prospects for the economy—just as the value of a stock is function of the future prospects for the company it represents. The future of the USA economy is bright. Much brighter than is apparent today.
The dollar does not seem to be going sideways when I pay the ever growing grocery bills.