QE, the Fed, and Inflation

(QE is shorthand for quantitative easing. It’s basically just printing money and the two videos in the post below this talk about it.)

This video will put the actual numbers regarding the bailouts in the past few years into perspective.

And those were just the bailouts. The Federal Reserve inflates through the fractional reserve banking system constantly as well. So when you hear certain individuals harp on about inflation, they have an extremely good reason to do so.

Some even like to talk about hyperinflation, what occurred in countries such as Germany and Zimbabwe, where the currency completely loses its value and people have to haul around carts of money to buy a loaf of bread. While this is certainly possible in the United States, I don’t think it’s very probable. Even though Bernanke (the current Fed chairman) believes in a completely flawed economic theory (Keynesian economics), I don’t think he’s stupid enough to let hyperinflation occur before he contracts the money supply. Very high inflation in this year is far more likely.

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Posted on January 21, 2012, in Economics, Politics. Bookmark the permalink. Leave a comment.

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