David Engstrom writes:
The unpredictable, unthinkable but undeniable, has come to pass. After $6 trillion of additional national debt and trillions more in Fed stimulus, the economy shrunk for the first time in 3 years. So, has money printing worked or not? The money printers will answer with a resounding, “Yes!” Had it not been for the trillions of dollars created out of thin air and injected into every arm of the economy, the economy would have disintegrated long ago. It was the money printing that saved us from losing all of our wealth.
Yup! That was a close one! How close? By some accounts, we were just minutes away from economic Armageddon. For most, that’s a difficult concept to grasp. It’s easy to understand how highly leveraged investors, did lose or could have lost everything. But what about the average person who owns some life insurance, keeps money in a money market, has a few CDs, some savings an annuity and a pension. What about that person? It seems the only risk there, is varying rates of return.
But think about it. Every cent of your paper wealth is invested somewhere by someone in some thing. Go ahead. Go down the list. Do you think the financial institution you gave your money to can provide you a rate of return without putting your money at risk? Even the balance in your checking account is at risk. If you think a bank, any bank, could cash everyone out of their savings and checking, on demand, you are ill-informed. The only way your cash is safe in a bank is if it is in a safety deposit box. Even then, cash rots, as inflation gradually eats away its value.
Put in that perspective, maybe the money printers are right – money printing saved us. God help us if that’s true. If we were really that close to economic Armageddon, guess what? We’re ...