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Which is why everyone in Washington was freaking out and throwing cash out the window in 2009. Crony capitalism aside, they were terrified of deflation(and righ
by deelowe 14y ago
Which is why everyone in Washington was freaking out and throwing cash out the window in 2009. Crony capitalism aside, they were terrified of deflation(and rightly so).
- Eliezer 14y agoThey weren't throwing nearly enough cash out the window to make up for everyone suddenly wanting to hold more money. NGDP still crashed. Inflation dropped. The spread on inflation-indexed Treasury bonds warned that monetary policy was far too tight and the market knew it and was signalling this well in advance. Low interest rates do not mean loose money... oh, never mind, everyone just needs to go read The Money Illusion.