Saturday, March 20, 2021

Funny Money

 I’m getting tired of “experts” saying that the torrent of money being created by the unholy alliance between the Treasury and the Fed is not really worrisome, won’t lead to inflation, won’t affect the status of the US dollar as global reserve currency, and so on.

Ok, just one chart: 

Annual Percent Change in M3

C’mon, no effect? Seriously???  The madness with cryptos, NFTs, massive speculation and volatility in clinically dead company stocks, SPACs, 12 year old stock traders... no effect??? 

Inflation IMHO is not going to come so much from a “hot” economy driving up demand.  Instead, it will be goods producers and service providers realizing that with all this funny money sloshing around the nominal price of their wares MUST be marked up in order to maintain their intrinsic value. 

Bottom line: funny money = monkey business.

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