Quantitive Easing is deployed with a goal of increasing inflation sure, but do you disagree inflation is pretty much inherent in any monetary system since the concept of money was deployed?
Yes I disagree. What do you expect from someone named Discordia?
What about monetary systems based on the gold standard which have provided stable prices for decades and centuries (punctuated by outburst of
price inflation during wartime episodes mostly)? What about a system based on Bitcoin? I dare say most monetary systems are not inflationary...it's just that currently the fiat monetary system (which is inflationary) is ubiquitous.
Oh there might be some confusion about inflation. It helps when we clarify whether we're talking about
monetary inflation (which is easy to pinpoint by definition) or
price inflation (which is harder to distinguish and even harder to describe how it works).
Since I find monetary inflation to be a much more useful concept than price inflation, that's what I'm looking at. And what I see is that Quantitative Easing = adding to the money supply = monetary inflation. Feel free to disagree.
I'm confused
I think we're basically saying the same thing?
Yeah, a system based on bitcoin would be great. But we're not there yet. Money we'd need to at least plug in and have power running to use is cool but stable physical legal tender for now will will rule. I'm hoping for wireless charger tech to take over so everywhere we walk in cities/ towns we're juicing up wirelessly and never have to recharge our portables. Bitcoin would fit great there, and MTgox would still suck.
I don't disagree and typing this post made me miss this jump in price!
To be more exact, quantitative easing is CB printed money intended to replace the credit money which normally appears in a debt-based economy by
new bank loans. It is not yet inflationary because the fall-off in new loans since the credit crisis began is greater than the amount of QE.
This is also why interest rates are near zero, to encourage new loans. The problem with this CB meddling is that the reason new loans have fallen off is because consumers, households and companies all realize that too much borrowing has occurred, is unsustainable, and want to pay down debt.
If governments ran balanced-books they would agree, but they are debt-addicted too, and can't tolerate deflation because it makes their own debts larger in real terms and even more unsustainable.
