Sunday, November 14, 2010

600 billion dollars created by the Federal Reserve

Some fear this could trigger inflation, but compared to the housing bubble, I think the inflation would be relatively mild. The housing bubble was significant inflation. Just 600 billion more dollars dumped into the economy now would not likely be that significant. Part of the reason why the Fed may be taking this action is to continue trying to prop up parts of the housing bubble. The inflation has already happened and the Federal Reserve may be attempting to curb the deflation that comes after the inflation of the housing bubble.

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