Someone explain to me how we are not headed towards a major, MAJOR depression with an impending currency crisis.
I am under the impression, per our graph here, that we have increased the monetary base by 400% due to QE.
What has kept the markets from responding to such a massive devaluation?
Looking for honest discussion.
Although it's wrong, you should then logically expect values to appreciate by 400%, the devaluation is only reflected in term of other currency but that being said QE is happening in eu and china so idk
>>1098440
There will be another recession in 3-8 years that will just be another good opportunity for young/inexperienced people to shift to a higher class. It happens every decade, and the reason it will never be "MAJOR!!!" is that there are plenty of people to exploit, both at home and around the world, to keep everything moving forward. On the other hand people think that a power outage for a few days or unusually bad traffic are tragedies, so you'll still be able to entertain yourself with "MAJOR" news stories about how hard life is for overweight Americans who can't find a sale that week or something.
>>1098459
3-8 years...
You're crazy. The recession is already here. It will be a long recession given the nature of the recession. We might be out of it by 2020 if govt. doesn't fuck shit up worse.
This one is going to be many multiples worse than the Fin. Crisis for people who are unprepared.
>>1098462
>You're crazy. The recession is already here. It will be a long recession given the nature of the recession
kek
God that's a shitty graph
>>1098440
The money isnt on the open market. Its tucked away in banks and the fed pays the banks above interest not to loan it.
So it keeps liquidity up without driving inflation
>>1098501
that's all fine and dandy, how will the government remove that money from an open market once the liquidity isn't an issue? Or will that shit one day hit the inflation rate like a tidal wave.
>>1098592
I would like to know the answer to this
>>1098592
research "casino gulag"
by converting real money into digital dollars that dissapear into thin air....cash traded for non physical items
>>1098592
>>1098639
i will give you a hint
okay the hint is...
THE FEDERAL RESERVE
>>1098655
What the fuck am I reading
>>1098440
>What has kept the markets from responding to such a massive devaluation?
Because that money never actually leaves the banking system. You need to understand how QE works and how deposits/loans work in the banking system to realise no amount of QE could ever cause inflation.
>loans create deposits through credit creation
>deposits in circulation
>loans on bank balance sheets
>Fed wants to lower interest rates
>Fed purchases the LOANS from bank's balance sheets
>this doesn't alter the amount of deposits in circulation, only the amount banks have in reserve at the Fed
It's IMPOSSIBLE to create inflation through QE because not a single penny of that QE ever goes into circulation.
>>1098455
>QE is happening in China
>>1098462
>4 Years of recession
AAAAHSHSHAHAAHAHAHAHAHAHAHSHSHSHSHSHAHHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA
>markets are very closely linked internationally
>through many different steps, slowly destabilize local currencies & the international standard currency (i.e. USD)
>conspire to steer economies in certain ways so countries start dropping USD as the standard currency
>all currencies at chaos
>hold an emergency meeting at IMF, and introduce a plan to roll out a new international currency that will be accepted worldwide no matter which country you visit (except for best korea)
>make everyone bear the mark of the beast
>>1098796
Global recession, retard. The start of the subprime to the end of the Financial Crisis was approximately 3 years or so.
>>1100024
>Global recession retard
>posts chart of U.S. recessions
>>1100024
>calls someone a retard
>doesn't understand what a recession is or what the thread is about
Actshuallley, we have been in a recession for 500 years!!! fuck business cycles, the tv says life has only gotten worse >:(
>>1098440
QE does jack shit. If your calculation of the "monetary base" included t-bonds and whichever other safe assets are bought in QE, then the chart would obviously just be a straight line.
There's no evidence that bonds vs reserves makes a difference.
>>1098737
This guy is right. I'm surprised at how few "educated" people understand this.
>>1098737
>It's IMPOSSIBLE to create inflation through QE because not a single penny of that QE ever goes into circulation.
If a product exists even though it is never put up for sale or "circulation" it still affects the price of said product in the open market.
>>1100194
Are you shitting me?
>>1100282
Just like the price of oil is affected by the discovery of unproven untapped resources.
See Wickard v. Filburn
>>1100290
No, that's bull.
Filburn, for all intents and purposes, put his grain into the circulation by consuming it, thusly reducing the amount he would be needing to buy from the market.
A product that does not enter the circulation in any way, ie remains not consumed, does not affect any price.
A ton of canned bologne in some unimaginably huge warehouse will not affect the price of canned bologne unless it enters the market or starts being consumed.
UNPROVEN untapped resources don't mean jack shit. PROVEN oil reserves will not change the price unless it enters the market.
The only way for oil price to change without any new oil entering the market would be either when we're about to run out of it, or when, say the Saudis want to fuck over Iranians.
>>1100305
Supposedly a trillion dollars was printed, the fact that it exists lowers the value of the currency overall even they are kept in a bank vault.
You have your opinion, I have mine.
>>1100317
Economics isn't about opinions though.
But I wasn't arguing about inflation. I was arguing strictly about you claiming
>If a product exists even though it is never put up for sale or "circulation" it still affects the price of said product in the open market.
>>1100319
> Economics isn't about opinions though.
Actually it is.
> But I wasn't arguing about inflation. I was arguing strictly about you claiming
>If a product exists even though it is never put up for sale or "circulation" it still affects the price of said product in the open market.
What is a price? If you are in that market and you know that there is a ton of bologna out there sitting in a warehouse that will have a effect on what you're willing to pay or sell your bologna for.
>>1100324
>If you are in that market and you know that there is a ton of bologna out there sitting in a warehouse that will have a effect on what you're willing to pay or sell your bologna for.
Not really.
It would be nonsensical for sellers to demand a higher price.
It would not be economically justified for buyers to demand a lower price.
The warehouse hasn't opened its doors yet. It's product does not affect the market yet.
>>1100317
>That's just like, your opinion, man
A trillion dollars in reserves is swapped for a trillion in bonds. Both are dollar-denominated assets. You somehow believe that the dollar will devalue because the Fed conducted a yuuuge asset swap. Well I guess it's just your opinion after all.
>>1100327
Have you even ever dealt with people buying and selling shit?
You may think it doesn't make sense, but in peoples minds it does, that is why economics and rationality don't go together, people aren't informed consumers even when it is their job in a company to be a informed buyer.
It also doesn't make sense that a product would be made only to sit in a warehouse never to be sold, that only exists in theory, in the real world that wouldn't happen, because even if it doesn't enter the market let's say something has to happen to it and it will cost money to the person holding it no matter what they do with it.
>>1100332
>
You may think it doesn't make sense, but in peoples minds it does, that is why economics and rationality don't go together, people aren't informed consumers even when it is their job in a company to be a informed buyer.
Literally
>you might think so, and you'd make sense, but NO
>It also doesn't make sense that a product would be made only to sit in a warehouse never to be sold
That was the premise though, was it not?
>>1098440
Neoclassical economics is weak.
MV=PQ
Velocity has gone way down too.
