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View Diary: David Stockman: “get out of the markets and hide out in cash” Corruption Of Capitalism (122 comments)

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  •  General inflation is only possible when theeconomy (0+ / 0-)

    is operating at full capacity & employment.  Otherwise any new dollars created by the Govt only go to increasing production.
    Inflation is actually a pretty simple equation:
    more money and the same amount of real goods and services = inflation
    more money and an equivalent amount of increased goods and services = price stability
    less money and the same amount of goods and services = deflation
    Of course we are nowhere near full capacity right now and at the pace we're going....we're not likely to be in this decade and as such there is absolutely inflation to be concerned about.
    After all, a little inflation is absolutely vital in a healthy economy....it prevents hoarding and allows people to be able to afford their interest payments on the debt.

    MMT = Reality
    http://neweconomicperspectives.org/

    "The Earth is my country and Science my religion" Christiaan Huygens

    by Auburn Parks on Mon Apr 01, 2013 at 02:49:42 PM PDT

    [ Parent ]

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