the recent readings i’ve done are contradictory to your claims and i would like to explore this further…
you say that the fed can essentially print unlimited dollars. but that’s false; when the value of the dollar hits zero, no amount of additional printing will help.
inflation is winding down as credit is contracting. the high rate of defaults are destroying banks and brokers who built jenga structures of leverage off liar loans. these banks and brokers are scrambling to shore up capital and not scrambling to issue more bad loans.
you’re suggesting that inflation is a means of producing infinite growth. that by printing money, value will be pushed up. which is not logical; an apple is an apple at 10 cents or 20 dollars. the price of the apple may increase with everyone awash in funny money, but the value is the same.
evidence of deflation is here: home prices, job losses, tax revenue losses, corporate earnings losses… these impacts will filter through the economy, tanking the prices of food, gold, oil, etc because demand will evaporate. evaporation of demand for overpriced homes is what started this ball rolling. when liar loans became the norm along with free credit, inflation did occur. but destruction of credit is now causing deflation.
the fed cannot print money. interbank interest rate cuts do not equal printing of money. interbank interest rate cuts only matter if banks are lending to each other. they are not. discount window, taf and taf2 loans require collateral and while collateral is becoming pretty liberal, while allowable institutions is becoming liberal, that’s still not the same as printing money; if the collateral continues to dump in value, the borrowing institutions must pay the difference.
purchasing a home at 3x wages may hedge against inflation, but not at 9x wages.
