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This is not correct. A dollar get "created" only when it is taken as debt, otherwise does not enter the economy. Actually , the amount of dollars decreased, as
by streetcat1 5y ago
This is not correct. A dollar get "created" only when it is taken as debt, otherwise does not enter the economy. Actually , the amount of dollars decreased, as people paid down debt, thus destroying the amount of money in the economy.
What you see is a supply side inflation (less goods due to supply chain interruption) and not demand side (more money).
- seibelj 5y agoStimulus checks are not debt - that’s helicopter money. And the “loans” made to businesses do not need to be repaid, or have 0% interest and are automatically forgiven after N years.
- nodesocket 5y agoPPP loans are not 0%, they are insanely low though at 1% interest. Also they are not automatically forgiven, you have to complete paperwork, and even then it’s likely that 100% of the loan won’t be forgiven.
- xhrpost 5y agoI see this back and forth, could you help me understand why these dollars shouldn't be considered "created"? My limited understanding is something like this: Congress/President decide US citizens need stim checks. They decide to issue $1T+ in stim checks. The Treasury doesn't have enough money from taxes so it issues debt notes / T-bills. A lot of these T-bills then get purchased by the Fed with dollars they printed out of thin air. So how is it that printed Fed dollars are not ending up in the hands of the average citizen and thus entering the economy?