DinarAlert

No rumors, no hype, just solid intel regarding the New Iraqi Dinar

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MALE
65 years old
seattle
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1 Comment

Reply Enorrste
5:02 PM on September 16, 2012 
The FED is responsible for the total money supply. Typically the FED can continue to issue new money because money is always being destroyed (worn out) and economic growth requires that more money exist. In an ideal world the increase in the money supply is "even" with the increase in economic activity, meaning no inflation. Of course in the real world that isn't the way it works. The FED is always printing more money than can be absorbed by the economy. Hence, we have inflation, making our dollar worth less and less.
Since the US went off the gold standard in 1971 the dollar has lost $.97 of its value. That is hard to believe, but it is true. In 1971 terms our 2011 dollar is only worth $.03.
You are correct in your assessment. By stimulating the economy more Bernanke is not doing the country any favor. In fact, he probably is doing this just to prop up Obama so that he gets re-elected. For a number of reasons the main result of this "stimulus" thus far has been to increase stock prices dramatically, even though the economy itself has not benefited much. Notice that the stock market is within striking distance of its all-time high again? But the economy is weak, at best, and may be entering another recession.
The net result of his stimulus will be higher prices at home. There is nothing good about it. What we need is less spending, not more printing.

Steve