Wen | Zhou Xian
Last week, Hong Kong media boss Shi Yongqing said in an article titled "The United States Slows Its Inflation by Dragging the World":
"After the second press crisis burst, the Fed Bureau successfully reversed the defeat in the form of QE. At first, people thought that the sequelae of QE would be inflation, but QE only brought about an increase in asset prices, but consumer prices remained stable, and the lives of ordinary people were not affected much..."
"The depreciation of general consumer goods is very fast, and there is not much investment value, people will only buy and use, will not buy to hoard, so the additional funds generated by QE will only flow into the financial asset market, not into the consumer goods market, and have little impact on consumer prices." If so, inflation has not been left behind by QE. ”
I almost completely agree with the above words, except for the last sentence: "If it leads to inflation, the world is not left behind by QE." ”
On the contrary, QE is the source of chaos and even collapse in today's world. All because of the flow of funds into the financial market, the consequence is that asset prices have skyrocketed unreasonably, which has directly led to the serious aggravation of the gap between the rich and the poor in the past ten years.
You know, the wealth of the poor comes from earning ability, income and cash, the main wealth of the rich is assets, when the assets expand, so that the poor no matter how hard they work, wealth is not comparable to the asset appreciation of the rich, today's common social contradictions in the world, despite the global economic recession, the 500 people on the Forbes rich list have repeatedly broken new highs, because of the soaring property prices and the poor have no place to stand, causing social contradictions and turmoil, it is precisely because of this.
That's back to Bernanke, yes, the guy who just won the Nobel Prize in economics, published Inflation Targeting: Lessons from the International Experience in 2001, was named a Fed governor next year, became chairman of the Fed in 2005, and handled the financial tsunami from 2008 to 2009.
The so-called "inflation targeting" means that the dollar policy is linked to inflation: if inflation is high, tighten monetary policy, such as raising interest rates, and if inflation is low, use quantitative easing monetary policy, such as interest rate reduction, bond buying and so on. In other words, inflation is used to determine Fed policy.
Unfortunately, the so-called "inflation" does not really mean the amount of money issued, but only the "consumer price index", as Shi Yongqing said in the article, China, as the world's factory, squeezed commodity prices to the cheapest, so that while the amount of money increased rapidly, the inflation/consumer price index was stagnant. Thus, QE could go on forever, and the Nobel Prize may have been awarded to Bernanke by the 500 billionaires.
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