Print trillions of dollars

>stock market worth 23 tr crashes 30%.
>8 trillion gone

...

Money supply geratly depends on origination of loans (if you deposit 100$ and your bank uses this deposit to originate a loan of 100$ they essentially "double" this money). In case we hit recession origination of loans will go down and with this the money supply. "brrrrt" mainly compensates this decrease in money supply

...

that's fucking false
money in the private sector is money in the private sector.
all the bank is doing is keeping your 100 bucks liquid.
if what you said is true, then keeping your money stored in a coffee can in the woods would be the same thing as burning it.

>if what you said is true, then keeping your money stored in a coffee can in the woods would be the same thing as burning it.
From the perspective of the economy, it literally is.

no keeping my money stored in a coffee can in the woods relates to to a money supply of 100$. I don't know about you but i consider the money i have on my current account as cash. The debtor who receives the 100$ loan from the bank will also consider it as cash. so it is essentially "doubled". This is called "Credit theory of money"

The velocity of currency is the key here. To see the effect of inflation the increase in the money supply must exceed the rate of currency velocity. If the printed money just goes straight into bank reserves and sits there (which most of it does), and does not circulate into the economy, then it cannot exert inflationary pressure on prices.

Currency can fail to circulate into the economy like this for a number of reasons. A common one is that during times of mass uncertainty and fear like there is in the global economy right now, individuals and institutions tend to significantly curb their spending and begin saving as much as possible to prepare for the worst. This leads to a drastic decrease in currency velocity.

It is my belief that this is why we are yet to see inflationary pressure on prices. Individuals, companies and banks are not spending & lending at the moment. Simple as that. How long this period of fear and uncertainty will last, who knows, but the key is once confidence in the economy comes back and individuals & institutions feel confident to begin to spending & lending again, the velocity of currency increases back to where it was prior except that this time there is far more currency in circulation than there was before. This is when we see the beginning of hyperinflation.

There are a number of other factors involved also, most importantly the incoming tsunami of deflation that dwarfs the amount of currency injected into the economy by central banks in the last month or two.

Not false at all, well-known economic phenomenon called the money multiplier. Look it up dingus

This is only combating trillions in capital flight.

It's a drop in the ocean.
Maybe instead of the usual 2-2.5% inflation maybe we'll see 3% this year or something.

But that little drop in the ocean (if applied correctly such as in an acute and temporary crisis) can make a huge beneficial difference.

They just removed inflation from the economy, easy.

inflation as they measure it is a small basket of items (((they))) cherry pick to make it seem low

if you included everything that keeps bubbling (housing, stocks, cars and any other asset) you would actually see the inflationary effects of all the brrrrrrr

This, followed by “and once global demand falls is when you’ll see inflation”

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That Dollar Milkshake Theory is really going to come true isn't it?

Is this what those shadowstats I hear about take into account?

The idea is to figure out inflation as objectively as possible you dumbass.

you have to go back

Money multiplier is not the same thing as creating money.
I know the difference. Do you?

lol. the economy has a perspective now?
and what else? an opinion? and a favorite color?

>I don't know about you but i consider the money i have on my current account as cash. The debtor who receives the 100$ loan from the bank will also consider it as cash. so it is essentially "doubled".
If we can expect a certain amount of money to be "doubled" and we account for it, then it's no longer "doubled"
Just because you do a bad job of considering your money, doesn't mean that it is the way you think it is.

>asset goes up because of speculation
>"LOOK HOW THE DOLLAR KEEPS GOING DOWN"

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also dont forget foreign demand, the swiss for example have been printing money for quite some time but its still stable, because their currency flows out for exchange of assets like gold and stock. (SNB holds more Facebook stocks than Zuckerberg)

the same for the us there is ALWAYS demand for USD as long there is demand for oil.

I read an article about this a while back and the gist of it was that Volcker spanked inflation so hard back in the 80s that it curled up in a ball whimpering for its mama and doesn't have the nads to get back up again.

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Shouldn't thinks generally be deflationary due to technological improvements?

Technological improvement is inherently very inflationary; old shit loses value extremely quickly, and improved production processes create more and more tech products.

But things should cost less because they're cheaper to make.

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In some ways they're cheaper to make, but they're also made more complex. Look at smartphones or computers.
Software keeps getting more hardware-intensive as hardware gets cheaper and better.

The money might actually just be solving the liquidity issues in the market and not causing inflation like the fed has been telling us all along wow imagine that.

Well actually if you did all that you'd see deflation since we started.

you do know how money supply M1 and M2 is defined. so you consider your current account as long-term investment and not as cash? And i highly doubt that you will be able to expect the total amount of loans originated at each given time

>most importantly the incoming tsunami of deflation that dwarfs the amount of currency injected into the economy by central banks
I also think we're going to see further deflation, if only because I've read a lot of smart people think the same, but I'm curious to know why it will happen and when you think further deflation will begin?

Idiot

It's the corrupt fiat system.
Inflation IS happening on products, but those who run the system have monopolies over limited supply goods (like gold) and when that shit raise up too much they dump it.

you think inflation will happened in real time?

first deflation from 2020-2025. Then inflation 2025 to 2030.

So if there's a bunch of deflation what does that mean? Stock prices leg back down or just food is chwaper at sotre?

What tangible goods can I even put my money in that don't lose real value when the market goes peepee?
I don't have enough yet to get a house, that's for next year. AIs /PMG/ a meme? If the market collapses, will there even still be a strong demand for gold/silver to justify it's inherent value? I also feel strange about keeping a literal stash of gold in my house.

The fed obviously believes that the US will remain the dominant force in the world and the middle-lower class will pay the bill. Remember the fed is paid by the citizens and not a branch of government.

no one spends, everyone saves, which pretty much fucks everything, cheap stocks probably, everyone gets scared, don't know about the price of food.

So imagine you smoke a bunch of meth and you're feeling good and all of a sudden SHIT, you're low. So you try to drag it out. But it's shitty. No longer feel good, you're a bit twitchy and each small hit is to avoid crashing further. Nothing happens. You just feel persistently shitty. Finally you run out. You might fall asleep.

You wake up. You're alright but a bit below baseline. Nothing is too appealing. You save your energy and don't do much. Things just seem grey. Your motivation can't be to care too much until you get more crystal. Normally you'd be doing normal things but now that's too much energy to spend for such drags.

Mentally you're on ice for a day or two.

kek amazing analogy.

Deflation literally just means a contraction in the money supply. That’s it. Everything else that occurs in deflation are secondary effects from the contraction in the supply of money.

It might sound bonkers given the unholy amount of printing central banks are doing but this is actually what’s happening at the moment and in my view will continue for at least the next 12-18 months. Despite the absurd amount being churned out by printing presses, it is a drop in the ocean compared to the corporate debt bubble, household and personal debt bubble, and of course government debt bubble, as well as any other debt bubble you care to name. Most debt metrics are at unprecedented levels right now. Why this is likely to continue to cause massive deflation is simple - the only two ways this can go is:

A) all this debt continues to be serviced despite the shutdown of the world economy and record numbers of unemployed claims and all the other craziness and instability in the global markets right now, or,

B) Individuals, business, companies and governments start being unable to service their debt, and a massive wave of defaults and bankruptcies begin to happen. With the way our current monetary system works (credit money), when a loan is defaulted on this actually causes that amount of money to vanish from the circulating supply of currency. This is going to start happening en masse and will result in a massive contraction of the money supply, all at the same time that people are spending less and saving much more and generally being much more risk-averse with their finances (that goes for businesses, corporations and banks as well.)

>muh orange man bad!
no this has been in the works for decades
distrust between banks in the repo market and not knowing what banks are involved with the EPIC failure of the european central bank, who have been buying endless amounts of all the nation states debt at negative rates for over 10 years started this early last year
the virus was the sell off trigger

>armstrongeconomics.com/armstrongeconomics101/economics/is-trump-nationalizing-the-fed/

Hint, they're not retarded. They did this on purpose because they're fucking evil.

>Thinking this short term

Developing economies are FUCKED as money flows back into safe havens.

Thank you very much for your thorough reply. Apart from some of the memes, people like you are who I hope to find every time I come to Yas Forums

You're welcome. I hope I was able to offer some insight and clarity in these chaotic and uncertain times

>>asset goes up because of speculation

wrong, asset goes up because of inflated money supply

Cringe

Dollar value atm is supported by the other countries selling their USD denoted assets which supports USD demand. This is why FED created a new tool for lending USD cheap to foreign central banks hoping they stop it.

Let's be honest. The US could wipe out any country that even thinks of devaluing the dollar. Venezuela was a rag tag 3rd world country without nukes. The US is the most powerful country in the world. Power is what prevents inflation from occurring.