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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Tommaso who wrote (60386)	5/23/1999 3:23:00 AM
From: ForYourEyesOnly	Read Replies (1) \| Respond to of 132070

So....if/when the bubble bursts and we start heading towards deflation, the boyz gun the printing presses.....does that seem like a likely scenario? Cheers, THC

To: Tommaso who wrote (60386)	5/23/1999 11:19:00 AM
From: Knighty Tin	Read Replies (2) \| Respond to of 132070

T, You can print money, but you cannot create velocity with a printing press.

To: Tommaso who wrote (60386)	5/24/1999 2:44:00 AM
From: JF Quinnelly	Read Replies (3) \| Respond to of 132070

I don't disagree with Michael Burke on much, but agree with Milton Friedman that nothing is so simple as curing deflation. Just print money. Friedman isn't quite that sanguine, but he does write that the Great Depression needn't have been so severe and long-lasting if the Fed had acted differently. In A Monetary History of the United States he argues that the Fed should have suspended the convertibility of bank deposits into currency to slow down bank runs, and he argues that the Fed should have embarked on large scale open market bond purchases to counteract the contraction of the money supply caused by the demand for cash by the public and the desire by banks to raise reserves.