It is astounding how long experts can keep repeating the conventional wisdom in the face of -what SHOULD be – overwhelming reality. The way things work today, the Federal Reserve sets the interest rate. Additionally, inflation is determined primarily by aggregate demand. We have nearly 5 years of data backing this stuff up. Yet, . . . → Read More: All that Bunk About Deficits and Skyrocketing Interest Rates
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I read an article on MSN yesterday from February 3rd about how we’re at the “inflection point” where all that “quantitative easing” the Fed has been doing is going to start causing inflation. And, if we are finally at that inflection point, the world will then slowly begin to concern itself with stagflation and . . . → Read More: Inflation Chicken Little Bill Fleckenstein In 2009, there was a crazy, wild-eyed passion spreading among conservatives and the Teabagger. Here are some choice quotes from prominent conservatives and teabagger favorites. Glenn Beck and Ron Paul Ron Paul: [snip] So the bailout is a disease, it’s contagious, it’s ongoing, and the result of this will be the destruction of the . . . → Read More: Still waiting on that hyperinflation. Once when I was explaining Modern Monetary Theory(MMT) to someone in person, she asked me in a very irritated tone, “what is your point?” I realize now that getting too far into the details about government spending, trade deficits, and bond markets can make some people’s eyes glaze over without assuring them that the end . . . → Read More: Job Guarantee: Zero Unemployment Without Causing Inflation A lot of people think that the act of creating money will somehow create inflation all by itself. That is as ridiculous as saying the mere act of growing more food will solve world hunger(there’s so much more to it). Inflation is a complicated topic with few absolutes and a lot of misunderstanding. In this . . . → Read More: Inflation Comes from Spending Money, Not Creating It “If the government creates money all it’ll do is cause inflation and we’ll all suffer.” This is one of the deadliest lies we’ve been told for the last 40 years. For centuries, philosophers and economists thought that any increase in money would always increase prices. John Maynard Keynes pretty much set the record straight on . . . → Read More: The Useless Quantity Theory of Money We got the bastard. Osama bin Laden is dead. But, imagine if we applied the same litmus test to military expenditures as conservatives want to apply to social security and Education…. Picture Obama and his national security team debating if the united states has enough money to pay for the operation to kill Osama Bin . . . → Read More: Wait… Can we “afford” to kill Bin Laden? As you know, for you to save money, someone else must go into debt. As i explained last time, if 300 million people save one dollar, than one person must go into debt 300 million dollars. One person who could do this is the federal government. So if the entire private sector wants to save . . . → Read More: We Save When the Government Spends In a recent post, I pointed out that government spending is limited by inflation, not revenue. You might ask, “so what? don’t federal budget deficits and inflation rise together?” Well, not necessarily. There are times when other conditions can affect inflation other than the federal budget. Currency Destruction: If physical currency is destroyed or lost, . . . → Read More: Reasons Budget Deficits and Inflation Don’t Always Align Once upon a time, the budget of the U.S. government was just like your budget or any other household budget. This was because at one time the government was on a gold standard. Each dollar could be exchanged at anytime for either a small bit of gold, silver, or some combination of both. The amount . . . → Read More: The Federal Budget is Not Like Your Budget |
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