Comments on: Deflation Vs. Inflation: The Great Debate Rages On http://morality101.net/blog/deflation-vs-inflation/ Liberty without Force Fri, 03 Jun 2011 23:00:01 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Striker http://morality101.net/blog/deflation-vs-inflation/#comment-110 Striker Sat, 04 Jul 2009 19:47:32 +0000 http://morality101.net/blog/?p=1035#comment-110 FTA "In "normal times", banks wouldn't hold the trillions in bailout funds for a New York minute. They would loan it out over and over again. The bank loaning-multiplier would thus go to work and the trillions of dollars would get leveraged (via derivatives) many times over." Apply the K.I.S.S. formula here. The big bucks "loaned" to the banks was to get the banks in conformity with their margin requirements. That did nothing to add lendable funds to the bank portfolios, it only served to artificially avoid bank takeovers which the FDIC could not afford. So it did nothing to make more money available for loans. It is the simple insanity of manipulation by Gov and the Fed. FTA “In “normal times”, banks wouldn’t hold the trillions in bailout funds for a New York minute. They would loan it out over and over again. The bank loaning-multiplier would thus go to work and the trillions of dollars would get leveraged (via derivatives) many times over.”

Apply the K.I.S.S. formula here. The big bucks “loaned” to the banks was to get the banks in conformity with their margin requirements. That did nothing to add lendable funds to the bank portfolios, it only served to artificially avoid bank takeovers which the FDIC could not afford. So it did nothing to make more money available for loans.

It is the simple insanity of manipulation by Gov and the Fed.

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