5 ms·

Printing the money would create uncertainty - how much will the government print? How much will inflation be? How will the dollar fluctuate against currencies o

Printing the money would create uncertainty - how much will the government print? How much will inflation be? How will the dollar fluctuate against currencies of trading partners? Uncertainty kills business and this plan would hurt every aspect of trade and manufacturing.

adolph 5y ago
How is that hypothetical different from what exists now?
- bluedevil2k 5y ago
  The Fed has a 2% inflation target (used to be their only stated target, now they balance unemployment in their target numbers as well). This allows companies to plan ahead knowing with a fair degree of accuracy the expected change in purchasing power year to year.
  - adolph 5y ago
    That sounds like the answer to your own question, no? The root comment proposes that "They just create the money they need, the never-to-be-paid-off deficit grows, the value of the dollar shrinks, and we move on." How is that incompatible with an inflation target that "allows companies to plan ahead?"
    - bluedevil2k 5y ago
      No, not at all. How much will they print? 23% of GDP? 18% of GDP? That’s $1T difference in cash. How will that affect inflation? Who knows, no one can predict that. A shrinking dollar is bad for imports and America has a huge trade deficit right now, it would cripple international trade.
      - landemva 5y ago
        Tough luck that until some months ago, USA was a net energy exporter. Definitely do not want to ask why energy exports flipped to energy imports. Recall that a few days ago Joe asked Saudis to help out by pumping more oil.
      - adolph 5y ago
        I guess it is all academic since inflation acts as a tax on savings. Going to get taxed one way or another.
  - landemva 5y ago
    Congress created the private contactor known as Federal Reserve with mandate for employment and stable prices. 2% inflation, which violates the mandate and Congress does not care, compounded every year is why purchasing power since 1913 is aiming for the dirt.

adolph 5y ago

How is that hypothetical different from what exists now?

bluedevil2k 5y ago
The Fed has a 2% inflation target (used to be their only stated target, now they balance unemployment in their target numbers as well). This allows companies to plan ahead knowing with a fair degree of accuracy the expected change in purchasing power year to year.
- adolph 5y ago
  That sounds like the answer to your own question, no? The root comment proposes that "They just create the money they need, the never-to-be-paid-off deficit grows, the value of the dollar shrinks, and we move on." How is that incompatible with an inflation target that "allows companies to plan ahead?"
  - bluedevil2k 5y ago
    No, not at all. How much will they print? 23% of GDP? 18% of GDP? That’s $1T difference in cash. How will that affect inflation? Who knows, no one can predict that. A shrinking dollar is bad for imports and America has a huge trade deficit right now, it would cripple international trade.
    - landemva 5y ago
      Tough luck that until some months ago, USA was a net energy exporter. Definitely do not want to ask why energy exports flipped to energy imports. Recall that a few days ago Joe asked Saudis to help out by pumping more oil.
    - adolph 5y ago
      I guess it is all academic since inflation acts as a tax on savings. Going to get taxed one way or another.
- landemva 5y ago
  Congress created the private contactor known as Federal Reserve with mandate for employment and stable prices. 2% inflation, which violates the mandate and Congress does not care, compounded every year is why purchasing power since 1913 is aiming for the dirt.