Has the Fed Guaranteed Hyperinflation? There’s No Turning Back From QE.

[Sig]

It has been documented in 100% of cases that their actions only make matters worse. Good luck.

That is one of those completely inane statements on several levels. There is more total GDP and higher levels of GDP per capita in every country with a strong central bank now than there was before those countries had strong central banks. Before we had central banks intervening in economies we had things like the great depression, and before we had central banks at all we had things like the dark ages. So first it's simply objectively false to assert "It has been documented in 100% of cases that their actions only make matters worse." Where exactly has this been documented and by whom?
And second, this type of statement is absurd in the same way as it would be to claim since someone died 2 years after treatment for cancer the doctor must have made the cancer worse. The fact that recessions have happened despite central bank intervention in no way "proves" that the banks even failed, let alone that they "make matters worse". You would need a control without central bank intervention to know that, and absent that a basic understanding of macro to see what would have happened absent the intervention to at least be able to talk intelligently about it.

 

[zdreg]

What you have to understand is that the CB has a dual mandate

It has a 3rd mandate nowadays, the stock market. These manades are typical of 3rd world countries and inevitably have bad endings.

 

[tiddlywinks]

Can't have hyperinflation if the created money never enters the real economy, and instead just plows into stock and bond markets, which it has been since way back in the 1980s.

So the stock and bond markets are just black holes, that have nothing to do with the real economy, including monies received (profit or loss) when a stock or bond is sold, transferred, called, cancelled, merged, extinguished, etc?

How ridiculous.

It is true if money doesn't enter the economy there can't/won't, in theory, be hyperinflation. But to suggest the US financial markets are not part of the real economy nor are profits or losses derived from it, is hooey! As is the implicit idea you've provided that stock and bond markets are the primary recipient of new money created since the 1980's. Convenient hogwash!!

 

[zdreg]

to suggest the US financial markets are not part of the real economy nor are profits or losses derived from it, is hooey!

It is voodoo economics, It is Modern Monetary Theory perpetuated by Piezoe and others who believe that the laws of economics have been rescinded or are believers that hyperinflation is good for the lower classes and the poor, Interestedly these people don't move to Venezuela where these nonsenses have been put to practice.

 

[zdreg]

That is one of those completely inane statements on several levels. There is more total GDP and higher levels of GDP per capita in every country with a strong central bank now than there was before those countries had strong central banks. Before we had central banks intervening in economies we had things like the great depression, and before we had central banks at all we had things like the dark ages. So first it's simply objectively false to assert "It has been documented in 100% of cases that their actions only make matters worse." Where exactly has this been documented and by whom?
And second, this type of statement is absurd in the same way as it would be to claim since someone died 2 years after treatment for cancer the doctor must have made the cancer worse. The fact that recessions have happened despite central bank intervention in no way "proves" that the banks even failed, let alone that they "make matters worse". You would need a control without central bank intervention to know that, and absent that a basic understanding of macro to see what would have happened absent the intervention to at least be able to talk intelligently about it.

Unfortunately Sig cannot read my response. Let him bask in his usual ignorance.

 

[birdman]

When major institutions are suggesting that the Fed and other central banks have printed so much money that it can never be reversed, you know you have a problem.

I hope I'm wrong, but i think the US government intends to use hyper inflation to make debt levels a non-factor. Maybe they think a 33% inflation rate for 3 years running will make debt disappear?

In Argentina https://www.statista.com/statistics/316750/inflation-rate-in-argentina/ inflation was 34% in 2018 and 54% in 2019. Although it's alarming, it's hard to call it extreme if you look elsewhere.

In 2018, the Venezuela annual inflation rate reached 929,790% and is expected to reach 10,000,000% by the end of 2019. According to the April 2019 World Economic Outlook report, Venezuela's inflation rate of 10 million is the highest in the world.

Headlines at today's Drudge Report, tell a story about college students in Venezuela fainting because they had no breakfast nor supper. Many of their colleges are closed and ones that had 3000 students now have 100 of fewer. Most colleges there no longer serve meals.

 

[Sig]

I hope I'm wrong, but i think the US government intends to use hyper inflation to make debt levels a non-factor. Maybe they think a 33% inflation rate for 3 years running will make debt disappear?

In Argentina https://www.statista.com/statistics/316750/inflation-rate-in-argentina/ inflation was 34% in 2018 and 54% in 2019. Although it's alarming, it's hard to call it extreme if you look elsewhere.

In 2018, the Venezuela annual inflation rate reached 929,790% and is expected to reach 10,000,000% by the end of 2019. According to the April 2019 World Economic Outlook report, Venezuela's inflation rate of 10 million is the highest in the world.

Headlines at today's Drudge Report, tell a story about college students in Venezuela fainting because they had no breakfast nor supper. Many of their colleges are closed and ones that had 3000 students now have 100 of fewer. Most colleges there no longer serve meals.

And in Somalia they've had no government for a decade, so clearly that's something we need to worry about here in the US as well, right? And they don't have fainting college students.... because they don't even have colleges! Given the number of folks in government who are actively proposing elimination of government and publicly stating government is bad, that would seem to be a more relevant comparison than Argentina or Venezuela who no one is advocating we emulate, despite what you read on the Drudge Report. Of course either comparison is absurd, there's no indication whatsoever that inflating away debt is anyone's policy and it's absurd to even think that if you have a basic macro background. What relevance the hunger level of college students in Caracas has to if the US has a policy of purposefully pursuing hyperinflation is beyond me, you seriously can't have that level of credulity and lack of basic logic that you somehow think that supports your conspiracy theory in any way.

 

[zdreg]

In Argentina https://www.statista.com/statistics/316750/inflation-rate-in-argentina/ inflation was 34% in 2018 and 54% in 2019. Although it's alarming, it's hard to call it extreme if you look elsewhere.

Rethink whether your remark is logical.

 

[zdreg]

Headlines at today's Drudge Report, tell a story about college students in Venezuela fainting because they had no breakfast nor supper. Many of their colleges are closed and ones that had 3000 students now have 100 of fewer. Most colleges there no longer serve meals.

Your point is well taken to show the consequences of hyperinflation.

 

[zdreg]

it's absurd to even think that if you have a basic macro background. What relevance the hunger level of college students in Caracas has to if the US has a policy of purposefully pursuing hyperinflation is beyond me, you seriously can't have that level of credulity and lack or basic logic that you somehow think that supports your conspiracy theory in any way

Birdman- Ignore Sig's condescending remarks.