zhandax

Dollar Wins on Euro, Pound Weakness

LouThomas hit it on the head...if you want clarification, go back and read up on 'fractional reserve banking". The texts will tell you that when loans are repaid, it creates money destruction. What the texts don't mention is that loan default creates the same effect. The Fed was playing makeup on a large portion of its money creation the last 6 months. Now that they have run the presses past the largest estimate of the sub-prime losses, we are back into inflation territory.