----- Original Message ----- From: "Stephen A. Lawrence" <[email protected]> Date: Wednesday, March 18, 2009 3:08 pm Subject: [Vo]:Inflation Ho!
> Just in from the Wall Street Journal: > > > The Federal Reserve said Wednesday it will buy up to $300 billion in > > longer-term Treasurys > > When the Fed buys treasuries they do it with "new money", "high > poweredmoney", "magic dollars". Whatever you care to call it, it > means that > they create the money out of thin air. In fact, as far as I know, > thisis the only way the U.S. government currently has for creating new > money; everything else is just transfer payments. If only it were created out of thin air. In fact it is being taken from your grandchildren and greatgrandchildren. Harry > > Obama's mega plan, and Bush's not-quite-so mega plan before it, > involvednothing more than transferring a couple trillion dollars > from taxpayers > and bondholders to banks and related businesses. No new money was > created. > But this is different. > > In plain English, they're *printing* a third of a trillion dollars. > Printing money is the last and largest "canon" available to the > government in combating the recession. > > Apply the current high-powered money multiplier to that, which is > something between 10 and 20, and you get an effective injection of > between 3 and 6 *trillion* dollars. > > So, they have clearly decided to barrel ahead with inflating their way > out of the crisis. > > I'd have to guess that, for Bernanke to agree to this, the current > numbers they're looking at, which haven't been published yet, must be > *awful*. > >
