Print money and be damned, FT QE 2,3 and so on..............................

crazygaijin

Neither Merv nor Helicopter Ben wants to be know the central banker who followed the footsteps of losers. Urged on by those telling them to kick the can down the road even more writes Clive Crook in the FT " under the circumstances, better to print money and be damned."

We would have more faith in central bankers if they had not been responsible for the crisis in the first place.

That is they kept rates too low for too long.

Now they are about to make another monumental mistake. No two of them.

The first is already in progress. By promising the world low rates for an "extended period of time" they have created the conditions they wanted to aviod. Rates cant go any lower. They have their backs against the wall.

The second major mistake is still ahead. QE is a new weapon. It is not meant to kill fiat currency holders or bond buyers. It is meant to mearly scare them.

But when the QE shotgun stares them in the face what will happen? Investors will panic. They know the central bankers cant just pull the trigger a little bit. QE will be fatal. Investors will drop paper when the QE shotgun is fired. Inflation will soar.