Inflation

Myrmidon_J

zygurat789 wrote:

BUT since then we have had quantative easing whereby the worlds governments have printed billions of currency just to avoid these scenarios. Do you really think they won't have any effect?

QE will certainly have an effect. Just not the one you're predicting.

Question: did QE & ZIRP cause hyperinflation in Japan? Or were these brave new policy initiatives in fact followed by 'the lost decade'?

In America, the money being printed is just accumulating in bank reserves. This is because, in my opinion, much of the Western banking system is insolvent - the reserves are there to cover imminent losses.

How do you think the QE money will enter the 'consumer system' if banks refuse to lend it?

zygurat789

Myrmidon_J wrote: »

QE will certainly have an effect. Just not the one you're predicting.

The jury's out on that then

Question: did QE & ZIRP cause hyperinflation in Japan? Or were these brave new policy initiatives in fact followed by 'the lost decade'?

In America, the money being printed is just accumulating in bank reserves. This is because, in my opinion, much of the Western banking system is insolvent - the reserves are there to cover imminent losses.

Much of the western banking system is insolvent that's why the government had to bail them out and take them over, remember, but
the reserves are being paid to the dynamic capitalist country which has for years been the worlds most prolific exporter and has imported little.
When one nation fails to balance its trade this tends to happen as it did with Japan.

How do you think the QE money will enter the 'consumer system' if banks refuse to lend it?

How do banks make their money? Do they need to rebuild their reserves with profits?;)