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We should consider that the fed's methods of measuring inflation and/or injecting capital could be flawed. If the money injected by the fed is not making it to
by aeternum 6y ago
We should consider that the fed's methods of measuring inflation and/or injecting capital could be flawed.
If the money injected by the fed is not making it to consumers, then we should expect that inflation measured via some kind of consumer price index would not move.
- MiroF 6y ago> consumers Consumers take out loans, that's a fact. Interest rates are lower, that's also a fact. Therefore, the money is making it to consumers. If the Fed is able to expand the monetary supply without inflation, then that is a good thing (again) and the Fed should continue doing so until inflation does move.
- aeternum 6y agoHave a significant number of consumers taken out new loans? What percentage of consumers actually benefit, especially if they do not purchase a new home? >If the Fed is able to expand the monetary supply without inflation, then that is a good thing Expanding the money supply alone does not seem like the right goal. Suppose the fed decided to expand the money supply by cutting a check to the top 1%. I wouldn't expect to see any inflation in the pricing of general consumer goods since that segment of the population just isn't competing for those goods.