The FED cannot allow hyperinflation to happen, unless they do that in coordination with all major banks (Europe, Japan), because inflationary expectations will send yields on dollar securities through the roof as people get rid of dollars and move to euros and yens. They do not and they will not print money at the rate that would allow the situation to be described as “hyperinflation”.
Consider this scenario
– Interest rates are suppressed for another year or two, mortgage rates fall below 5%
– Treasury mails $1000 tax rebate checks for every person in the U.S.
– Our government convinces ECB to drop rates
If they pull this off, we’ll be out of this recession before we know it.
