tag:blogger.com,1999:blog-3635763372107166354.post6733850534496278513..comments2023-08-03T02:29:21.116-07:00Comments on Paronomasiac: The Economy is StalinThe Vitruvian Duckhttp://www.blogger.com/profile/01017022134940802535noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-3635763372107166354.post-41273097354281287872008-08-06T11:28:00.000-07:002008-08-06T11:28:00.000-07:00I can't help but agree that run-away money printin...I can't help but agree that run-away money printing is a bad thing. However, an economist I know once gave me a two-part argument that I'm still chewing on.<BR/><BR/>1) Some inflation is necessary, because everyone needs some dollars to spend. If you keep exactly the same number of dollars in circulation indefinitely while the population continues to grow, eventually somebody just won't have a dollar no matter what property he owns. So a gold or silver standard is not practical in the long term.<BR/><BR/>2) The Fed is not actually directly answerable to the rest of the government, not even to the President. So it is not correct to say that "the government" decided to print more money, if by that you mean congress or the president; they have no power to force that. Because of their relative autonomy, the Fed is able to pursue the good of the economy rather than political aims, and so in fact they generally aim to keep inflation at a moderate rate to satisfy the needs of argument #1 above.<BR/><BR/>What think ye?Ignoramushttps://www.blogger.com/profile/07941438311862464747noreply@blogger.com