Tuesday, July 17, 2012

The Cons of Debt Monetisation

Read the commentary from Steve Saville in full: http://www.321gold.com/editorials/saville/saville071712.html



"Even believing that under certain conditions the central bank does no harm (rather than does some good) when it creates new money requires disabling the part of the brain devoted to logic and common sense. Of course it does harm! Adding to the supply of money cannot possibly add to the total wealth in the economy, and yet some people get richer as a result of the monetary injection. If some people get richer while the total wealth is not increased, then other people must be made poorer and what we are dealing with is a forced transfer of wealth.
We now get to the essence of what central bank debt monetisation is: a means of transferring wealth from some people to other people."

I wish more people understood this!!

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