What about the Fed?

[AztecWilliam]

As in the Federal Reserve.

If you have, as I did, only a sketchy idea of the Fed's history and duties, you well learn something important from his piece. Will asks a good question; is the Fed trying to do too much?

www.washingtonpost.com/opinions/george-will-the-feds-mission-creep/2012/10/17/7bf8e96a-1877-11e2-9855-71f2b202721b_story.html

AzWm

[aztecwin]

Hard for anyone to get their arms around both the history and the duties of the Fed. Right now, I worry about inflation being pumped into the system. Am I right?

[aztecsrule72001]

Oct 18, 2012 14:07:41 GMT -8 aztecwin said:

Hard for anyone to get their arms around both the history and the duties of the Fed. Right now, I worry about inflation being pumped into the system. Am I right?

Inflation is definitely a concern. The Fed is trying to maintain low interest rates (encourage borrowing) in an attempt to spark the economy if/when they fail we could be facing some serious issues (with either higher interest rates or inflation).

Worst case scenario would be a lot worse than what we saw during the financial collapse. If you want to protect yourself, get away from dollars.

[aztecwin]

Oct 19, 2012 17:12:50 GMT -8 aztecsrule72001 said:

Oct 18, 2012 14:07:41 GMT -8 aztecwin said:

Hard for anyone to get their arms around both the history and the duties of the Fed. Right now, I worry about inflation being pumped into the system. Am I right?

Inflation is definitely a concern. The Fed is trying to maintain low interest rates (encourage borrowing) in an attempt to spark the economy if/when they fail we could be facing some serious issues (with either higher interest rates or inflation).

Worst case scenario would be a lot worse than what we saw during the financial collapse. If you want to protect yourself, get away from dollars.

If you really think about what is happening now, you must take the velocity of money into account. We are printing money like crazy, but that money is not sloshing around in the economy like it would if we had normal employment rates and normal participation rates. Money is sitting in bank not employed in loans. It is cash in the hands of large corporations and not being investing in expanding business. Get that money employed in commerce and you will see two things, one good and one bad. You will get people back to work and that is good for the nation. You will also see inflation like never before and that has to be a disaster unless you plan for it.

[aztecsrule72001]

Oct 20, 2012 6:23:07 GMT -8 aztecwin said:

Oct 19, 2012 17:12:50 GMT -8 aztecsrule72001 said:

Inflation is definitely a concern. The Fed is trying to maintain low interest rates (encourage borrowing) in an attempt to spark the economy if/when they fail we could be facing some serious issues (with either higher interest rates or inflation).

Worst case scenario would be a lot worse than what we saw during the financial collapse. If you want to protect yourself, get away from dollars.

If you really think about what is happening now, you must take the velocity of money into account. We are printing money like crazy, but that money is not sloshing around in the economy like it would if we had normal employment rates and normal participation rates. Money is sitting in bank not employed in loans. It is cash in the hands of large corporations and not being investing in expanding business. Get that money employed in commerce and you will see two things, one good and one bad. You will get people back to work and that is good for the nation. You will also see inflation like never before and that has to be a disaster unless you plan for it.

All you can do is prepare yourself for it. I feel sorry for those who will be blindsided by it. Hopefully something changes and it isn't as bad as it could be but I don't see anyone willing to make the drastic changes needed.