(01-31-2019, 07:30 AM)The Real Marty Wrote:

(01-30-2019, 05:57 PM)B2hibry Wrote: It may in fact cause inflation but remains to be seen. I think we are still pretty early into the newer policies. The Feds just announced interest rates will remain and they plan on staying patient. Whatever that means in their world. I think we’ll be fine for a bit after this last correction as long as nothing stupid occurs geopolitically.

If you want to see how government debt causes inflation, look at Venezuela.   Out of control government spending had to be financed by printing money, and now as a result, they have hyperinflation.   Then they compounded it with price controls which led to shortages and starvation.  

Venezuela has a few aggravating factors.
One is that the government puts arbitrary quotas on imports.  Lots of things become scarce that, by rights, should not be scarce.  The other is that they effectively have two currencies, the US dollar and their Bolivar.  The Bolivar is the one hyperinflating because everyone wants to be paid in dollars but many people are not paid in dollars.
They've made a lot of mistakes but these are not mistakes that the US is liable to imitate.

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