Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Glenn D. Rudolph who wrote (87149)	12/12/1999 12:05:00 PM
From: Eric Wells	Read Replies (1) \| Respond to of 164684

There are two errors in this argument. Glenn - thanks for your post. I disagree, however, with your assertion that there are two errors in my post. Firstly, no matter how much additional cash has been printed, one could have withdrawn their savings account prior to the printing. It is not fee in that the interest payed on the savings account stops. Yes, one could have withdrawn the money before it is issued by the Fed - but the question is what will eventually happen to all this extra money that is issued by the Fed? Will it stay in the economy - or will it be destroyed some time after Y2K? Every economics textbook I've ever read details pretty clearly that increasing the money supply causes inflationary pressure. I stand corrected on my statement that withdrawing money is free - I should have written it is "less expensive" then borrowing via credit card. Secondly, this has no affect on loan demand. My original statement was to the effect that if people had more cash on hand, initially, it would lessen the need for using a credit card - and that this might initially put downward pressure on interest rates. The effect would probably only be temporary - once Y2K passes, people are likely to either spend or re-deposit their extra cash. Thanks, -Eric