The term quantitative easing (QE) describes a monetary policy used by central banks to increase the supply of money by increasing the excess reserves of the banking system.
My primitive brain does not allow me to enter into any debate about the pro's and con's of electronically adding numbers to an account commonly referred to as "printing money", but to be honest, any action that causes a long-term (up or down) trend in the market is okay with me. This sounds a little selfish but after spending the better part of two days back-testing the Cheetum Market Indicator revision, you might develop the same attitude.
The term "trillion" gets thrown around quite a bit in these discussions. A trillion is nothing more than a million million, just like a million is simply one thousand thousands. It's so much more digestible that way. Visually, it's kind of mind blowing.
When Missus Cheetum heard QE2, in a moment's notice, bags were packed, ticket and hotel reservations were made and she's off to Margaritaville. Wrong QE2 but it got me fantasizing once again...
If a monkey could be the king of the jungle, 'he' would distribute a good chunk of these newly 'minted' zeros in coupons, good for a year, directly to several million taxpayers. The expiration date on the coupon would insure re-circulation and the ultimate "jump-starting" of the economy rather than allowing non-participating 'savers' to make use of those long-term high interest-bearing accounts. (They will thank 'him' later after the hyper-inflation.)
This is hardly an original idea but when you can grasp the idea of a 'trillion', and then start dividing a few trillion into mere millions of deserving (and undeserving) taxpayers, you can see how large those coupons could be with plenty left over for the banking system.
Oh-oh, wrong Potter!
Leave it up to a banker to spoil my fantasy.
Pecunia -money
Ex Nihilo - out of nothing
Tuesday, October 12, 2010
Pecunia Ex Nihilo!
