- This topic has 1 reply, 2 voices, and was last updated 18 years, 2 months ago by .
Viewing 2 posts - 1 through 2 (of 2 total)
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.
Home › Forums › Financial Markets/Economics › Why Bernanke Took This Job
PowaySeller, I read Bernanke’s book, “Essays on the Great Depression.” It’s a very tough read, and I only understood parts of it. The proper sequence of events is that we’ll have inflation, first: we run trade (consumer) and government deficits, and finance such via printing of money, now. Only when one or both of those change — reduced demand for consumer products/services and government services — will we run the risk of deflation. Consumers will slow down consumption as interest rates raise. But Federal spending shows no sign of abating, with the war with Islamic Fascists, Medicare, Social Security, etc. So, yes, we theoretically run the risk of deflation. But, such will require a greatly reduced level of spending by government, and I just don’t see that happening (though I wish it would!).
I presume that historians will view Greenspan in a poor light, having presided over rabid growth in the money supply and household debt.