Maybe a sluggish money velocity is not bad considering the 250,000-mile-high pile of pixels out there. Isn't that what's holding back hyper-inflation?
“Isn’t that what’s holding back hyper-inflation?”
There’s not nearly enough money chasing goods to cause anything approaching hyperinflation. The economy has excess capacity, which is a deflationary influence. There have been more assets destroyed and devalued than there has been money created since 2007.
Some of the inflow of money into the banks is staying in the banks since loan demand is not high, and lending standards have stiffened. Money that is not out in the system can’t cause inflation.
We are still walking the tightrope. It’s lousy for jobs and savers but it beats a deflationary depression.
At least that’s the FED’s take. It doesn’t matter if they are right or wrong, what matters is how one reacts to what they do.
Call the FED wrong all day, they will still be there tomorrow doing what they do.