Bernake says he is not printing money. The money supply is not growing.

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superstition's picture
superstition
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Bernake says he is not printing money. The money supply is not growing.

 

 In his testimony today he said there is no impact on inflation. He is not printing money. How long will this go on? And I'm just a simple small businessman someone please explain.

 Thanks

M2

caw's picture
caw
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Re: Bernake says he is not printing money...

1. Bernake is not lying, he speaks the truth while he has somebody punching numbers into a terminal, filling up the zeros and then press "enter": the way modern money is made in modern times - or: what choice does he have?

2. Inflation, as Chris's Chapter 10 describes very well, is a relative figure at the disposal of the paid, hence depending statistician whose results then are subject to interpretation by the politicians and officials.

3. But at the same time it is true: today's overall and overwhelming circumstances are totally unique; hence, whatever we call the forthcoming collapse or the single attributes is irrelevant under the light of the consequences being inescapable.

4. Bernake is as ignorant as you and me unless you believe in him being a seer.

Regards

Christian

 

KKPSTEIN's picture
KKPSTEIN
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Posts: 120
Re: Bernake says he is not printing money.

Ron Paul on CNN this morning:

Video: (http://www.youtube.com/watch?v=pUH7WxaYqFw)

Bernake understands the concepts of inflation very well.   Inflation is not prices rising, that is a symptom only.  Inflation = printing money. 

Best!  K

 

KKPSTEIN's picture
KKPSTEIN
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Joined: Oct 20 2008
Posts: 120
Re: Bernake says he is not printing money.

Ron Paul on CNN this morning:

Video: (http://www.youtube.com/watch?v=pUH7WxaYqFw)

Bernake understands the concepts of inflation very well.   Inflation is not prices rising, that is a symptom only.  Inflation = printing money. 

Best!  K

 

srbarbour's picture
srbarbour
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Joined: Aug 23 2008
Posts: 148
Re: Bernake says he is not printing money. The money supply is n

[quote]In his testimony today he said there is no impact on inflation. He is not printing money. How long will this go on? And I'm just a simple small businessman someone please explain.[/quote]

You can read here for a long explanation which will provide most of the tools required to analyze Ben's statements: Currency: An examination thereof

The simple answer:  What is currently being done should not be equated to printing money.   The current action (... provided the Fed isn't taking on bad assets...)  has little possibility of inflating the economy, and if it does, the inflation will be short lived and easily eliminated when the Fed 'buys back dollars'.

There is also a good reason for what the Fed is doing.  The general currency expansion going on is, at this time, the right decision.  The questions and fears related to this expansion should not be directed at the expansion itself, but rather the quality of assets that the Fed is 'taking onto its balance sheet' so that it may expand.

--

Steve 

 

Ray Hewitt's picture
Ray Hewitt
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Re: Bernake says he is not printing money. The money supply is n
There is also a good reason for what the Fed is doing.  The general currency expansion going on is, at this time, the right decision.  The questions and fears related to this expansion should not be directed at the expansion itself, but rather the quality of assets that the Fed is 'taking onto its balance sheet' so that it may expand.
If may be a good reason from the Fed's point of view. From a rational view it's insane. If my understanding is correct, he's trading worthless assets (derivatives) for bonds. Flooding the market with bonds is not exactly healthy for the Treasury market. There is no way can the Fed prevent this crash. Delaying only makes matters worse when market forces overcome the Fed. That applies to whatever the Fed is doing to prevent the market from correcting itself.

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