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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Maurice Winn who wrote (4407)	6/7/2001 12:31:23 AM
From: LLCF	Read Replies (1) \| Respond to of 74559

<Since the USA government owns the printing press and so do other countries own their printing presses, when they print more money, the government is the one which gets to spend it.> You are partially correct... when the government prints more dollars current dollar holders lose value by that amount, since there are many foreigners holding dollars as a store of value there may be positive worth to U.S. citizens when more are printed. Of course what the money is spent on is another can of worms entirely. <That's why you can be sure that stock markets will continue a permanent increase [with the usual downdrafts on the way].> In local currency terms. DAK

To: Maurice Winn who wrote (4407)	6/7/2001 2:29:30 AM
From: smolejv@gmx.net	Respond to of 74559

>>when they print more money, the government is the one which gets to spend it.<< repeat - inflation is a method to redistribute GNP - or steal it. All depends on its level. dj

To: Maurice Winn who wrote (4407)	6/7/2001 10:39:01 AM
From: pater tenebrarum	Read Replies (3) \| Respond to of 74559

you err in one not insignificant point. all an additionally printed dollar does is debase the value of all remaining outstanding dollars. no value is created, it's just a piece of paper. what it DOES do, is punish all savers. so even though it is a form of back-door taxation, it does NOT confer a social benefit. i agree with you that a rise in productivity should normally result in price deflation, were it not for the excessive money printing. now THAT would be beneficial, since we could all afford to buy more goods and services as a result. this potential benefit is taken away by the money printing. likewise, the increase in stock prices is offset by the decreasing value of the currency, and thus is largely smoke and mirrors. adjusted for price inflation, the return on equity investments is paltry. adjusted for the growth in the broad monetary aggregates since Greenspan helms the Fed it is actually negative.