Quote:
Originally Posted by Lamplighter
Then expect inflation to kick in as a result of the QE2 program of the Federal Reserve Bank.
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The irony of this recession. Because so much wealth was created by inventing assets. By converting paper (ie mortgage backed securities) into assets. By inventing higher housing prices using money games. Therefore massive liquidity has simply disappeared. The average citizen was financially raped. Even with stimulus (ie $700 billion TARP), the amount of liquidity has diminished. Nobody realized how massive our fiscal corruption was. Bernie Madoff only an example of what was acceptable.
As a result, we are not suffering inflation. A fear (using Japan as a learning tool) is of deflation.
Unfortunately, too many economists believe money games can fix an economy. It did not work in Japan for 20 years. It never works. And still some economists are calling for 'healthy inflation'. Or something similar. Price increases. As usual, some economists that can see history also refuse to learn from it.
2000s is when all Americans were extremely wealthy (while the average American saw his income drop 2%). Wealth because tax cuts 'improved' the economy. Our political extremists told us so – even citing the Kennedy tax cut. Now learn from history and Kennedy’s tax cut. Money spent in 2000s means economics must take greater revenge in 2010s.
Massive government debts (ie tax cuts for the rich) meant everyone was wealthy (how good was it for you?). George Jr called that returning wealth to the people. Economics now takes a predicted revenge. All Americans must suffer today for tax cuts and other money games in the 2000s. Since this recession was created by financial games stealing from the public, deflation also exists.
We could start paying the bills and fix things. But wacko extremists want the richest Americans to only pay 16% while all others (including those who create most jobs) pay 22% or higher.
That is where your jobs have gone. Money games because "Reagan proved that deficits don't matter". If you do not know who said that, then you must be an ostrich. Deflation – not inflation – is another symptom of massive wealth squandered by the richest 5% Americans. So they need more welfare - more tax cuts - so that economics will take more revenge in 2020.