Player A has a pile of marbles; Player B has a pile of Smarties. Both piles have a value exactly the same.
Player A trades a 1 marble for 10 Smarties. Can't quite snack or play a game of marbles.
Referee gives Player A 10 more marbles; Player B looks at this and wonders and so asks Player A for 8 marbles for 10 Smarties. Still can't snack or play.
Referee gives Player A 10 more marbles; Player B starts thinking the game is rigged. Player A agrees to trade 16 marbles for 10 Smarties.
You now understand how "Quantitative Easing" works and how the American dollar soon won't be able to buy any Smarties. We also call this "inflation" and "devaluation". You may want to google Zimbabwe and/or the Weimar Republic.
Hey! Where the hell are my Smarties?!
But seriously, Obama will have to let inflation ride if he can't raise taxes (but he will probably do both).
Osumashi Kinyobe at November 8, 2012 10:50 PM
"But seriously, Obama will have to let inflation ride if he can't raise taxes (but he will probably do both)."
Not without the House he can't. All tax and spending MUST originate in the HOUSE.
Weimar. "ei" is pronounced "I", "ie" is pronounced "ee".
Hence Wiener is "weenier", "wein" is pronounced "wine", which is what it means
(yes I know that the German w is between English w and v, and the equivalences in the vowels are not exact).
One of the more amusing errors of this sort occurs in S. Newton's biography of Field Marshal Walther Model, in which he repeatedly spells
"Leibstandarte" (Life Guard, for Hitler) as "Liebstandarte" (Love Regiment). Adolf would have been very very surprised!
Executive Order
Darn. I googled that too. Thanks John.
Sasquatch, I think that will happen, House or not.
Chinese slave labour has been exporting deflation for decades.
I too, have been waiting for this supposed "Weimar moment", but it doesn't seem to matter how much money is printed or for how long.
We've all seen the charts and they just don't seem to matter.
Sooner or later someone needs to explain why.
jeff, everyone is doing the same thing, so the devaluation is relative (by definition, really).
It will stop. The merry-go-round will end. I trust everyone has checked their funds for anything that says, "US ..."
If I remember correctly quantative easing use to be referred to as "going nuclear on the economy" because it was the absolute last desperate measure to save a failing economy. Now the Obamanation does it every single month to the tune of $40 billion with no set "end date" like they have in Afghanistan. Incredible.
All depends on how fast it happens. It's like the proverbial frog in a pot of boiling water, bring the heat up slowly and it will let itself be cooked.
Quantitative not quantative. iPhone auto correct....
Well, I don't have ant smarties, but I do have some smart pills for sale.
---------------
Mutt: These smart pills you sold me taste like sh*t.
Jeff: See, you are smarter already.
*any* (yes I did check before posting - need some eye pills)
Spend like there's no Zimbabwe!
Wonderful post, Lance!! In the past two days, I have mentioned the Weimar Republic every time that I have explained why I'm looking for employment in Canada now.
Lance, if you'll e-mail me at the address attached to this comment, I'll supply you with some data that will probably interest you (it supports your position, which is also mine).
I heard this on Hannity. Quantitative Easing is like adding water to good scotch. You still have a drink but the more water you add the less it tastes like good scotch. And eventually all you have is flavored water with no alcohol to speak of.
Alan, only a Philistine adds water to good Scotch.
Hence the Quantitative Easing. Its high class brigandage, where they literally steal the value of your savings right out of your very pockets and you can't see them doing it.
Barry planning to raise taxes on top of the four year long money printing spree is the part when he spits on you after taking your wallet.
Problem, HALF the US population seems 100% happy to let him do it. Guarantee they won't be happy after he's finished.
Watching gold go up, and up.
I do a Zimbabwe 100 Trillion dollars (one) for about e-bay about $3.50 with US the mail. I'll thinking to see our quarter US IRS or Michigan for the amount a good one! At our Marquette, all gold paid watches all jewelry and most from the 10 after people from the homes in the paper.
“Inflation is the one form of taxation that can be imposed without legislation.”
Milton Friedman
Lance, I have checked my holdings- either equities which will rise with inflation, or USD borrowed.
Philanthropist- Your Zimbabewe line deserves to be repeated far and wide.
I beg to disagree, Phantom. You don't want to water good Scotch down, but a wee splash of water in a solid shot will unlock the flavour quite impressively. It's worth experimenting a bit to get the right amount. Of course, you'll have to have a few shots of good whiskey in the process, but no one said excellence was undemanding...