Another market meltdown

[cdude1034]

NJ5 said:

cdude1034 said:

 

I'm still doubtful that inflation and devaluation of the US dollar won't result... However, it seems pretty obvious that the economical leaders are in panic mode, triggering measures literally every single day now. The situation doesn't seem that simple to me.

How many dollars did the banks "print" to fix this mess? This must have a consequence in terms of inflation.

 

 

You're absolutely right, there will be inflationary consequences, and price of the dollar...well, since something only has value relative to something else, we'll have to see. It's not just America's economy that suffering.

Apparently, we've spent $600 billion on bailouts so far. Well, that's not technically accurate, $600 billion is how much the Fed has pledged to help. The real total could be less, but that's the upper limit at this point, and that's the number we need to use for all intensive purposes until we can look at the aftermath.

I know you know that banks don't actually print the money, but I am curious myself to see where the Fed got all of this money. As we speak, the treasury is selling debt on behalf of the Fed. I believe the article said a total of $160 billion worth. This doesn't mean that the Fed's in trouble, but even our Fed has to stay somewhat liquid, and selling debt is a good way of doing it.

There will be inflation. The overall extent of it will be determined by just how far up their asses everyone's head was before this all started.