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Again, QE is not inflationary



January 10, 2012 – Comments (4)

And to futher hammer the point home that Quantitative Easing is NOT inflationary (as explained in these posts:

-- One of the smartest comments I have read yet regarding Quantitative Easing
-- Follow Up: QE is not Inflationary, Thoughts on Risk Asset Instability

), and is in fact slightly DEFLATIONARY, see this:

Federal Reserve to Return $76.9 Billion to US Treasury From What Central Bank Earned in 2011

Yes, income the economy would have earned without QE…

But then for those who call this Government Debt a 'burden on future generations' read this:

What would happen if the US Federal Government stopped issuing bonds?

We continue to see evidence that the US will *NOT* go the way of Greece (the US and EMU operate on fundamentally different fiscal and monetary systems) and in fact based on policy decisions we are heading in the direction of Japan.

4 Comments – Post Your Own

#1) On January 10, 2012 at 4:37 PM, chk999 (99.97) wrote:

So what do you think the McDonald's basic hamburger will sell for in 2020? It has been a decentish constant value good that you can use to track changes in the USD.

I bet it is around $2 then. 

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#2) On January 10, 2012 at 4:48 PM, DJDynamicNC (40.44) wrote:

QE is not going to be inflationary while there is a shortage of aggregate demand, which is exactly what we appear to be experiencing.

Good blog post.

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#3) On January 10, 2012 at 9:07 PM, devoish (64.79) wrote:


I think the burger will cost will depend upon whatever global warming does to the water and corn supply that feeds that beef. By 2020? More than you think. $2.01. 

Best wishes,


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#4) On January 11, 2012 at 10:28 AM, PeteysTired (< 20) wrote:

Wouldn't global warming allow more land to be available for farming?

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