Copyright John T. Reed 2014
Here is Steve Forbes talking about the chances of hyperinflation in the current 1/20/214 issue of Forbes magazine:
If you had told any financial observer in 2008 that the Federal Reserve would expand its balance sheet five-fold in five years, you’d have encountered astonished disbelief, followed by the assertion that if ever such a thing unfolded a Weimar-Republic-like hyperinflation would ensue.
Steve’s reference to the Federal Reserve balance sheet is another way of speaking about the so-called “Quantitative Easing I, II, and III” which I and many other call “printing” money. Technically, it is the Federal Reserve Bank “buying” U.S. government bonds with money it does not have. It is the modern, electronic computer equivalent of the way they ran the printing presses 24/7 in early 1920s Germany to print way too much currency, tereby triggering Germany’s and Austria’s notorious hyperinflation where you needed wheelbarrows full of currency to buy anything.
Forbes says we have not gotten hyperinflation yet because of the Fed also suppressing long-term interest rates. He hates this and say it is not only risking hyperinflation but also harming economic growth.
John T. Reed