QotD

Michelle Bachmann again, completely messing up basic macroeconomics.

The shorthand way of describing to you what quantitative easing is is a license to print money without any value behind it…In the last two years of the Obama administration, if you pull a dollar out of your pocket, you have lost 14 percent of the value of that dollar. That means the federal government has stolen that money from you… They’ve been printing essentially valueless money and flooding it into the money supply. I don’t stand for that. A dollar in 2011 should be the same as a dollar in 1911. A dollar should be worth a dollar.

It’s genuinely frightening that a national level politician knows less about Econ 101 than I did in tenth grade.

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One response to “QotD

  1. Bachmann’s economics are better than yours — and apparently those of the author of the post you referenced. http://seekingalpha.com/article/127585-the-gold-standard-and-inflation

    I don’t know if the gold standard is the answer, but she’s technically correct — when the government prints money it’s diluting the monetary base, and stealing value from everyone who already owns money.  And when the money’s not pegged to anything of real value — like gold — then basically the only thing that determines the value of the money is its scarcity (how little there is); i.e., how much they’re printing.

    With this government, this administration, this central bank — the quantity of money is completely out of control.

    I don’t know that it’s completely accurate, but it’s been said that a relatively constant quantity of gold has been enough to buy a handmade men’s suit for many, many years.  Obviously in that same time the buying power of a dollar has shrunk continuously.  Zero inflation may be idealistic and austere, but at least it’s honest.  This government is stealing from everyone.

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