Federal Reserve Chairman Ben Bernanke fired back amid criticism at home and abroad of the Fed’s easy-money policies, arguing that China and others are causing global problems by preventing their currencies from strengthening as their economies boom.
Apparently, The Federal Reserve’s policies of U.S. currency devaluation are just fine. It’s the rest of the world who is to blame.
Mr. Bernanke has come under attack for the Fed’s decision to purchase $600 billion in U.S. Treasury bonds in an effort to drive down long-term interest rates. Critics in the U.S say it could cause inflation. Critics abroad say the flood of dollars that the Fed is effectively printing to finance its bond purchases is pouring into overseas markets and could cause asset bubbles.
Could cause inflation? Let’s just refresh our memory here: the DEFINITION of inflation is an increase in the currency supply. Is that happening? YES! Therefore inflation is occurring, and has been occurring for years. The only question is when will we begin to feel the dramatic effects of inflation….which is rising prices. Most of us whole live in reality, and do not send our personal assistant to do our grocery shopping for us, already believe rising prices are upon us.
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