Yes, this is an economic post. The Fed has bailed out a handful of near bankrupt financial institutions that had bad loans. In essence our tax dollars have just gone to pay for somebody else’s stupid mistake. Anything money needed beyond what our tax dollars have paid for has been printed up by the Fed to cover the cost of these institutions. What does that mean? Well, our dollar will progressively get even weaker. What else does this mean? Well, it means that for now, America has gotten the ‘hit’ of what it needs. We needed our “drug” fix and we got it. The real problem comes when we run out of “drugs”. We don’t have an endless supply of money and we can’t just keep our economy propped up on an artificial currency. So whenever that time comes, we totally deserve whats coming. Our sense of entitlement to a good economy now will come to haunt us when the government can’t afford to support us any longer.
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October 3, 2008 at 2:05 pm
W
I agree that this is a problem. I am also totally confused about how this is supposed to not cause inflation.
But that’s not my question. My question is, why can’t we go on doing this forever? Why can’t we just keep printing money?