Fed does not have its heart or head in the right place -- the policies are simply WRONG, WRONG, WRONG.
It appears that I am more cynical here. I suspect that this is not a case of policies simply being misguided, but more likely they are the result of a conscious decision, a plan. The intent is to get out of trouble by causing inflation.
Creditors, both domestic and foreign, would get screwed. Debtors would get bailed out as inflation makes their debt trivial. Bureaucrats, as I pointed out in my post this morning, would remain in control and still be reasonably popular, and they would put the blame on another crop of fall guys, including perhaps some foreign central banks.
I think this is the general strategy. It may not succeed, but they'll give it a good try. The process might accelerate sharply if some foreign holders of USD's decide to switch to a different reserve, be it another currency, or gold, or whatever. The moment they'll want to trade in their dollars, sparks will fly.
All IMHO, of course. |
