According to Bloomberg, Ben Bernanke and the Federal Reserve have pledged “to keep the main interest rate near zero for an “extended period” and confirmed that emergency measures to prop up the housing market will end as planned this month.”
inflation's archives
Swift Wits: Insurance Premiums Will Drop 3000 Percent!
under: Complete Whimsy, Federal Reserve, Obama Says
Tags: Barack Obama, ben, Ben Bernanke, Bloomberg, China, Chris Dodd, Consumer Financial Protection Agency, Fannie Mae, Freddie Mac, George Bush, gold, health insurance, healthcare reform, IMF, India, inflation, insurance premiums, interest rates, Larry Kudlow, Lewrockwell.com, Nancy Pelosi, stimulus package, too big to fail doctrine
Cities Printing Their Own Money
The Federal Reserve and Treasury have pumped an ungodly amount of money back into the economy, which raises serious concerns about future inflation, but for now, much of that money is stuck in the banks and velocity is extremely low.
So what have some city governments and businesses done to combat this? Well, they’ve decided to print their own money. MSN Money highlights one such example:
Bernanke’s Plan For Tighter Money
We haven’t seen inflation on the whole during the financial rescue efforts, despite the Federal Reserve’s easy money policies. If you wanted to cherry pick certain assets, the argument could be made that $140/barrel oil, during a recession, coinciding with a dump of liquidity on the economy, could be related. Global oil transactions are denominated in US dollars. It is hard to imagine any other factor being solely responsible for such a historic, and counterintuitive, rise in petroleum during a recession.
under: Deficits, Dollar, Energy, Federal Reserve, Game Theory, Individual v. Collective, Live and Learn, Taxes, Treasury, Trust
Tags: Ben Bernanke, easy money, Fannie Mae, financial crisis, fractional reserve banking, Freddie Mac, housing, inflation, real estate, stagflation, tight money, Treasurys, velocity of circulation
Fed Posts Record Profits
The question is, can the Fed take enough money out of the economy without sending us back into a severe recession, or will the excess money lead to high inflation. Personally, I’m predicting some pretty vicious stagflation is coming our way.
Hyperinflation: Myth or Possibility?
Will the massive increase in money cause hyperinflation? I certainly think that high inflation will come when velocity picks up, however, YouTube user ramzpaul makes a good case that given the way our economy is set up, one thing we won’t have to worry about is hyperinflation. For the Austrians out there, it’s worth taking a listen to:
Leggo My Eggo: Waffle Shortage Sending Shock Waves Throughout Country
But no computer algorithm or breakthrough in nano-technology could prepare our species for this latest blow below the belt: Eggo waffles will be rationed until mid-2010! Kellogg’s, the maker of these toaster delights, reported grocery stores will experience a shortage due to flooding of an Atlanta bakery during heavy October rains, as well as mechanical problems with equipment at it’s largest waffle facility in Tennessee. (1)
Why Gold is the Go-To Asset to Store Value
Many people wonder what makes gold special as a store of value. When inflation fears set in, people flock to gold. One answer is that the dollar used to be backed by gold. An even better answer I will leave to Judy Shelton, an economist and director of the National Endowment for Democracy:
Almost Half of U.S. Households Will Pay No Federal Income Tax in ‘09
According to estimates by the nonpartisan Tax Policy Center, 47% of U.S. households are projected to owe zero federal income tax in 2009. (1) Is this good, bad, or inconsequential?
Niall Ferguson: China Moving Away From U.S. Dollar
Economic historian Niall Ferguson and James Fallows discuss the Chinese reaction to U.S. fiscal policy. In short, many in China see U.S. fiscal policy as out of control and the dollar heading for major depreciation.
Tom Woods: The Case Against the Fed
Here is an excerpt from a longer debate, where Tom Woods lays out the case against the Federal Reserve.
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