Posted on 01/19/2021 7:50:13 AM PST by SeekAndFind
Imagine getting up one morning and finding helicopters hovering over the neighborhood. They are showering down cash on the community. All one has to do is go and pick up an allotted amount. Such a prospect might seem too good to be true. However, in these chaotic times, it might become the new normal.
The concept is called helicopter money. Nobel Prize-winning economist Milton Friedman coined the term in 1969 to envisage how sudden increases in money supply universally distributed would affect spending and saving. His conclusions were not favorable. No one took it seriously at the time. Everyone agreed that it should be avoided.
Calling in the Choppers in a Time of Crisis
However, some people now think it will help get the country out of the present mess. It seems like an ingenious way to get the money in the hands of those who need it.
But free helicopter money is a sign of desperation. Since the 2008 subprime mortgage crisis, the Federal Reserve has resorted to a toolkit of money injection instruments to prime the economy. This has included near-zero interest rates and massive central bank purchases of government bonds, called quantitative easing. The COVID crisis has only increased the pressure to free up money to “stimulate” the economy and prevent collapse. However, there are few tools left in the Fed’s toolbox.
Hence, everyone is turning to helicopter money in the form of universally issued stimulus checks. The thinking behind this is that government spending is not enough. It is time to be daring and give the cash directly to consumers so they might rush out and spend it. Increase demand for more products will jumpstart the industry into producing more goods. The economy will soon be humming again -- and voters will gratefully reward legislators
(Excerpt) Read more at americanthinker.com ...
If the next checks are approved, the federal government will have handed out $900 billion in COVID helicopter money. That is more than America’s 2020 defense budget! And it is all conveniently put on the federal tab for future generations to pay.
The reason why free cash does not work is that people tend to spend money based on their long term income projections. If given a one-shot boost, many people will either save the money or pay down debt, which does little to stimulate production. Researchers found that only 15 percent of Americans spent most of the $1200 checks issued last spring.
Such payouts have been tried in the past with little to show for them. Presidents Ford, Carter, Bush II and Obama all sent in the helicopters in one form or another. None of their efforts achieved stimulus goals and ultimately hurt the poorest people by slowing down recovery. Based on past evidence, Hoover Institute fellows John Cogan and John Taylor reaffirm that “they did not work then and they are not working now.”
Damn the Torpedoes, Full Steam Ahead!
But doesn’t all that money in circulation going to cause inflation?
You are aware that it’s the job of the voters to stay on top of this.
The idea behind the stimulus money is not to help out Americans or improve the economy. It is (per the Cloward and Piven strategy*) to debase the currency and destroy the economy. (Obama doubled the money supply twice and it did nothing to the economy. That’s because nobody would invest if their investment could be GM’d. This is why Trump’s economy did so well. All of that money came flooding back as investments.)
The feds have boxed themselves in. Be prepared for hyper inflation. This was likely by design to destroy the dollar, our Constitution, and our country.
All in an effort to force a cashless form of one world control.
Is that a joke?
The issue is that the “cash” being tossed out there is not being spent by the people who have jobs—and who have been working throughout the whole shut down. The money is being put into the bank or being used to pay down credit cards.
Those who ARE hurting, use the money to “catch up” on debts.
Paying down debt is not a stimulus to the economy. It merely moved money from people to banks, and back to the Fed. It sits at the Fed. There is no velocity to it.
Open up the economy. Get people “out” again. You will see the velocity start up.
But, you know...Covid...
You are aware the voters are retarded...
You are aware the voters are retarded...
The Velocity of Money, the # of times it changes hands in economic transactions (or V) is equal to the Gross Domestic Product (GDP) divided by the Money Supply (M)
v = GDP / M
So as the printing money goes up things slow down. When does the printing press run out of paper?
Government prints money but that is not what makes it valuable. It is the everyday work that people do. To redistribute money means they have to steal that work first making those who do the work less inclined to continue doing so.
For me, all my preparation for the future is, well, first and formost my faith in God, but after that it’s ownership of stuff money is normally used to buy. e.g. real estate. If money becomes worthless, it just means my stuff is worth more of it.
But yeah, we’re screwed. We were before the pandemic. This just all puts it on the fast path. Hence my tag line.
And a return to cash for clunkers because that policy failed so miserably.
They have perfected their strategy of cloward and piven.
Since prices aren't going up much but the stock market is, I wonder if most of the stimulus ended up betting on stocks instead of the general economy.
RE: But doesn’t all that money in circulation going to cause inflation?
Eventually, it will. We aren’t producing much because of the lockdown, but we are printing lots of money and going into further debt.
TOO MUCH MONEY CHASING TOO FEW GOODS = INFLATION!
Just buy Bitcoin, gold and Ethereum.
I know people in their 50,s and 80,s who have never voted but by Gawd they have political opinions!
I tell them to STFU, you have no right to an opinion!
I am thankful idiots dont vote but wish they would not try to sway public opinion.
Guess who these people lean toward?
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