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Robert William Allen

 
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  • Inflation Or Deflation: Which Should We Fear? [View article]
    The Federal Reserve is currently buying upwards of $80 billion per month in MBS' and US Treasury Debt. When the Fed buys Treasuries, that money then flows from the Treasury to pay government employees, contractors and so on. Those paychecks are then cashed and go into bidding up the price of goods and services in our economy. This is new money and constitutes inflation of the money supply which causes price inflation.
    Mar 7 12:43 PM | 2 Likes Like |Link to Comment
  • Quantitative Easing: Bloodletting The Economy [View article]
    The US does have a fiat currency money supply. You may wish to read up on the words "fiat" and "money" because you don't seem to understand the terms. Granted, most of that fiat money is not actually printed, but it's creation works in exactly the same way. Think of how many times in a week you make purchases and/or payments without using actual cash money. When the Fed bought up MBS's from Fannie and Freddie they didn't instruct the Treasury to print a bunch of money. They created a credit on the asset side of their balance sheet (out of thin air) and then used that new money to buy up MBS's and Treasuries. Please explain how you arrive at $70 trillion in 2007 and $50 trillion today? M1 is about $2.1 trillion, M2 is about $9.5 trillion and M3 (although no longer reported) is most likely around $15 trillion. And 10 year Treasury bonds yield less than 2% because the Fed is buying them up. Granted, the Euro debt crises is pushing money into our Treasury market as well, but the lion's share is Fed intervention.
    Sep 21 04:12 PM | Likes Like |Link to Comment
  • Quantitative Easing: Bloodletting The Economy [View article]
    I don't agree. Look at food and energy prices. QE is making it's way to mainstreet. Granted ZIRP is a contributing factor but that also works in the same way, more or less, as QE.
    Sep 21 03:21 PM | Likes Like |Link to Comment
  • Quantitative Easing: Bloodletting The Economy [View article]
    Couldn't agree more...
    Sep 21 03:21 PM | Likes Like |Link to Comment
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