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Re: Does the US have a Revenue or Spending Problem?
Old 04-27-2012, 08:14 AM   #3
Professor S
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Default Re: Does the US have a Revenue or Spending Problem?

I agree that the Fed has done a pretty good job of balancing the opposing inflationary forces of cheap money and depressed markets, but IMO the side effect is slow growth. The cheaper money is, the less incentive banks have to lend, and the greater the uncertainty when businesses consider investing in themselves. This is why I have always maintained that the Fed is an effective backstop to a crash, but a terrible stimulator.

Honest question: Do you think inflation would still be low if Europe wasn't in the state it is in? Isn't the value of money in a fiat system relative to other currencies and markets?
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