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True, it allows people to buy more tomorrow with the money they have today. So what happens? They don't spend the money today waiting for tomorrow. But then tom
by nanairo 16y ago
True, it allows people to buy more tomorrow with the money they have today. So what happens? They don't spend the money today waiting for tomorrow. But then tomorrow they realise that if they wait a little longer they'd spend even less.
The end result is that nobody spends for anything that is not absolutely necessary. Hence most companies have an excess of supply: they fire people, and discount they current production.
Now that more people are out of a job and therefore can't spend much, and the discounts have driven inflation even deeper, even less people spend their money.
It's a vicious cycle. It's what's happened to Japan for the last decade, and it's not a pretty place to be in.
- startuprules 16y agoYes, and we are going to have economic correction regardless of whether the government print or not. Printing just makes the correction even greater and the suffering more pronounced.
- nanairo 16y agoI am not arguing that a correction is not needed. Is the speed with which you do it that creates problems.
- startuprules 16y agoSo no printing (let the market correct itself) or printing (let the government siphon off taxpayer money to rich, pretend it's for the good of people)