Fed running out of money? Worrying about inflation only if certain condition is met? Sleeping in cash keeps you calm?
1. The Fed pretty much “prints” money. It’ll never run out of it! The Fed and the Treasury are happily injecting liquidity to bail out the markets. Buying toxic mortgage paper or guaranteeing (with our taxpayer dollars) $29 billion of Bear Sterns iffy assets are two examples of how the Fed is injecting liquidity by the truckload.
2. I’m already worried about inflation, regardless of Dow level.
3. How can you sleep soundly having your assets in cash? Unless your cash is in euros, your dollar stash is shrinking by the week thanks to (1) above. The more money is created, the less value it has. That we need more and more dollars to buy corn, soy, wheat, gold, silver, oil, than only a year ago is proof of the shrinking value of the greenback.
