2.5 billion dollars a day for eight months, means a total of $600 billion. This much will be U.S Federal Reserve printing for now to avoid deflation (officially). Unofficially it will be many others, anticipated or not. Here is what is known:
- To easier finance U.S. debt, which almost nobody wants to finance them. The only small issue is that after such a magic inflation, almost nobody will want to keep their reserves in American dollars.
- To depreciate the dollar and thus, to stimulate the exports. Yes, it cheapens the iPhone and will cost just triple to the copy of Chinese. The bad news for Americans is that BMW will be more expensive. That is, when you do not have anything to sacrifice, you sacrifice your welfare.
- For fear of savings to accelerate the economy and reduce the unemployment. Which probably will happen, but without any real gain effect, but only to redistribute the income from now to many other.
- To further inflame the stock and housing prices. How to be a crisis if everything is more expensive? Well, it’s like in the theory of relativity: all stand still, but the dollar is still lower. As an unwanted side effect, it might increase the quotations goods.
- Because, while all other countries are occupied to fight with the just imported inflation, the U.S. quietly seeking a real solution for the crisis.