Back during QE2 you had partisan hack Krugman rationalizing it all (though QE had little to do with his Keynesian philosophy). Guys like Bob Murphy were saying, “Yep, this is it, get ready for the inflation.” And then it didn’t come. And yet, all this market interventionism, aren’t there consequences. I mean, does money actually in fact grow on trees?
It seems that by inflating three or four successive bubbles since the dawn of the fiat dollar, the Fed has created multiple classes of mutually-dependent over-inflated assets (housing, college, stocks, salaries, hell – even the structure of service vs. manufacturing jobs). The problem after ’08 was deflation. I’ve heard the word disinflation as well. So actually there has been massive inflation, but it’s been struggling to fight the complete collapse of these assets. No wonder we have a lost millennial generation and rising income inequality.
Then there’s “MMT” which basically says, “Look if X amount of dollars needs to flow into these assets to keep them at price, then just make those dollars.” The economy as such is a just plumbing structure and as long as you keep the water pressure at the right place the structure will survive. I guess that’s true, in that we’re seeing it now. The market no longer has the cash to keep things as they are, so the Fed is just making the cash.
And here’s the problem with MMT. You can’t print more oil (then what there is). You can’t print more qualified, responsible business leaders. You can’t print a solution to rising chaos and violence in schools as over 50% of kids come from unmarried households. You can’t print a work ethic.
Yes, you can always create more tokens, you can keep the water pressure high. But then the pipes and junctions start to rust and break down, and there’s nothing to replace them with. And you can only afford to make all these little teeny pipes to rebuild the structure, but they don’t connect to the big pipes, and can’t handle the water pressure.
I think total collapse is the plan. All that matters is who has power afterwards. Remember the police robots and work conditions from “Elysium” (dumb Matt Damon movie)? That’s the future.
We have to go back to 1920, economically, in order to rebuild the pipes. With 10 times as many people, and a host of other problems. Good luck with that.
I still think the “best” thing libertarians can do is build that library of answers. So that future generations can see from our perspective concerning what has happened. We should be writing to the future, and to the past. Just my opinion.