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The Federal Reserve will be incentivized somehow or coerced into more situations where it simply devalues the dollar in order to make debt payments easier to ma
by andrewmcwatters 3y ago
The Federal Reserve will be incentivized somehow or coerced into more situations where it simply devalues the dollar in order to make debt payments easier to make.
The national equivalent of having a long-term mortgage. The house becomes cheaper to pay off over time.
- panarky 3y agoYour theory is contradicted by actual events. The Fed doesn't set the value of the dollar, but it can influence the market value of the dollar lower by (1) reducing short-term interest rates, or (2) monetary policy (buying bonds on the open market). But in actual fact, it's been doing the exact opposite of that: (1) raising short-term interest rates, and (2) selling bonds on the open market and letting others mature. And it seems reluctant to change direction in any big way any time soon.