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There is a distinct difference between some pump and dump strategy and a central bank printing a ton of currency. One has a temporary effect on supply and deman
by jm__87 9y ago
There is a distinct difference between some pump and dump strategy and a central bank printing a ton of currency. One has a temporary effect on supply and demand for the instrument in question, the other has a permanent effect.
- tinokid 9y ago>the other has a permanent effect This is not really accurate. There are of course many ways both fiscal and monetary for policymakers to "tighten the screws", as it were. They just haven't chosen to do so in recent years.
- jm__87 9y ago* Permanent until the central bank chooses to contract their balance sheet at some point in the future. Perhaps a better way to describe it is that a pump and dump strategy has a transient effect on the value of the asset in question, whereas a central bank increasing the money supply has a persistent effect on the value of the currency in question.