interestrateripoff Posted April 29, 2011 Share Posted April 29, 2011 http://www.bbc.co.uk/news/business-13237843 The eurozone's inflation rate edged up to to 2.8% in April from March's figure of 2.7%, according to official data from Eurostat.The increase takes inflation further away from the European Central Bank's target of just below 2%. The cost of raw materials and high energy prices have contributed to the increase. The ECB started raising rates in April from their record low, with a quarter point increase to 1.25%. The rise in the inflation rate will put pressure on the ECB to raise interest rates further. Someone soon might add inflation is happening because someone is printing money. Nothing to do with the Bernanke. Move along now nothing to see... Quote Link to comment Share on other sites More sharing options...
scepticus Posted April 29, 2011 Share Posted April 29, 2011 Someone soon might add inflation is happening because someone is printing money. Nothing to do with the Bernanke. Move along now nothing to see... In which case why has all this money printing not raised oil prices to levels significantly different to those in place in summer 2008, before all this alleged money printing took place? Quote Link to comment Share on other sites More sharing options...
ken_ichikawa Posted April 29, 2011 Share Posted April 29, 2011 Deflation dear deflation... Inflation does not exist! Prices going up money printing +M numbers going up are all indicative indicators of deflation. Quote Link to comment Share on other sites More sharing options...
neil324 Posted April 29, 2011 Share Posted April 29, 2011 In which case why has all this money printing not raised oil prices to levels significantly different to those in place in summer 2008, before all this alleged money printing took place? Did every thing spike then as is now or just oil? Quote Link to comment Share on other sites More sharing options...
Kazuya Posted April 30, 2011 Share Posted April 30, 2011 Deflation dear deflation... Inflation does not exist! Prices going up money printing +M numbers going up are all indicative indicators of deflation. Gold & Silver are proof we are deflating... Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted April 30, 2011 Author Share Posted April 30, 2011 In which case why has all this money printing not raised oil prices to levels significantly different to those in place in summer 2008, before all this alleged money printing took place? http://www.zerohedge.com/article/real-threat-inflation-decreasing-foreign-reserveswhy-us-should-expect-8-inflation-next-three There is some money which is printed, but does not make it into the money supply. Consider the scenario that the Fed prints a dollar that is then either lost or destroyed. It then cannot be used to buy goods, or be lent out and thus does not create inflation. There is something else which can happen to our money which has the same net effect. Foreign central banks can take cash printed from the Fed and place it on their balance sheet. US dollars on foreign banks balance sheets gives investors confidence that their own currency will not be debased. In our current (weakening) dollar regime, the US dollar is the main foreign reserve currency. When foreign central banks put US dollars onto their balance sheet, they take them out of circulation. They are not being used to buy goods. These dollars are not lent out. As such, they do not create inflation. ...... In other words, the real threat of inflation is not the current printing of money which Bernanke et al have been doing. It is the previous printing of money which has been taken out of circulation. The threat is as great as its ever been. The amount of money in foreign reserves is about one third or more of M2, or every dollar which is held by US bank account (business or retail), and all currency combined. Patience is possible needed to see the ultimate effect of the US printing money and monetising its debts. Everyone has been printing fresh money for years, all based on the presumption it's covered by increases in productivity and real economic growth. Unless real productivity and economic growth happens, then the end game of inflation and bust will play out. Quote Link to comment Share on other sites More sharing options...
scepticus Posted April 30, 2011 Share Posted April 30, 2011 http://www.zerohedge.com/article/real-threat-inflation-decreasing-foreign-reserveswhy-us-should-expect-8-inflation-next-three Patience is possible needed to see the ultimate effect of the US printing money and monetising its debts. Everyone has been printing fresh money for years, all based on the presumption it's covered by increases in productivity and real economic growth. Unless real productivity and economic growth happens, then the end game of inflation and bust will play out. Nevertheless, that means the oil price **today** is cannot be the result of money printing, as you suggest. Or at least, not the result of creation of new base money. If one accepts that government debt is also money, then the oil price could fairly be blamed on money printing I would say. Quote Link to comment Share on other sites More sharing options...
Errol Posted April 30, 2011 Share Posted April 30, 2011 In which case why has all this money printing not raised oil prices to levels significantly different to those in place in summer 2008, before all this alleged money printing took place? Give it time. Oil is going to $200+ a barrel. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted April 30, 2011 Author Share Posted April 30, 2011 Nevertheless, that means the oil price **today** is cannot be the result of money printing, as you suggest. Or at least, not the result of creation of new base money. If one accepts that government debt is also money, then the oil price could fairly be blamed on money printing I would say. No it's from printing money in the past. Printing money works providing there are new goods/services for consumers to chase. If there aren't no goods/services for consumers to chase then existing goods/services will become more expensive with the ultimates of engergy and food skyrocketing in price. Quote Link to comment Share on other sites More sharing options...
scepticus Posted April 30, 2011 Share Posted April 30, 2011 Give it time. Oil is going to $200+ a barrel. I think you'll find that it'll soon come back down again when people start moderating their demand, which they will. If you doubt that then look what happened to demand in 2008! The commodity bubble will burst, including gold, which will be interesting because after that what is there left to have a bubble in? Quote Link to comment Share on other sites More sharing options...
Game_Over Posted May 2, 2011 Share Posted May 2, 2011 I think you'll find that it'll soon come back down again when people start moderating their demand, which they will. If you doubt that then look what happened to demand in 2008! The commodity bubble will burst, including gold, which will be interesting because after that what is there left to have a bubble in? Can't believe you're still trying to convince people that we will get deflation. What we actually have - is what I told you we would get 6 months ago - STAGFLATION. Quote Link to comment Share on other sites More sharing options...
DTMark Posted May 3, 2011 Share Posted May 3, 2011 Can't believe you're still trying to convince people that we will get deflation. What we actually have - is what I told you we would get 6 months ago - STAGFLATION. I think I was posting something very similar a year ago or more. What deflation? Specifically, what are people talking about deflating - the money supply, incomes, consumer prices? The middle one will deflate. QE and base rates were to inflate the former and the last one will continue to be inflationary especially in terms of basics such as food, fuel, etc. Quote Link to comment Share on other sites More sharing options...
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