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Politics : Formerly About Advanced Micro Devices
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To: combjelly who wrote (489654)6/21/2009 5:23:29 PM
From: i-node  Read Replies (2) of 1574262
 
It depends on the underlying economy.

It is always inflationary; if there isn't a lot of money involved, it may not be noticeably so. And if there is a coinciding increase in productivity, hyperinflation may be avoided, but printing money is always inflationary versus not doing so. There is little reason to think we're going to see such an increase in productivity at this time, however.

For example, what happened to the hyperinflation following the spending during the Great Depression and WWII?

I think it is folly to assume that the period surrounding the Great Depression and WWII is somehow representative of how the economy works.

That said, do you honestly think we've not had inflation since the Depression?



Have you ever heard of the "Great Inflation"? And it coincides eerily with the chronic increases in national debt and money supply.

Your Krugmanesque thinking notwithstanding, when you print money you devalue the currency. Not sometimes, but ALL the time.

Obama is rolling the dice on whether he'll be able to generate a huge surge in productivity that will offset the inflation. And if it happens, the inflation MAY not be at a disruptive level. But there are a lot of "ifs" in there and in all likelihood we're going to see some fairly significant inflation a couple years down the road.
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