I’ve been railing about this problem for 3 years. There are currently over $2.5 trillion in excess reserves sitting at the Fed. Here’s the graph.
Eventually those reserves are going to come out into the banking system and absolutely flood the entire world with a tsunami of dollars. The effect on price inflation will be extreme.
What surprised me, even shocked me to a degree, was that this story was actually featured on the Yahoo Finance front page today. My mouth was hanging open, because I have never seen a mainstream report on this. The author even uses the term “price inflation” to differentiate it from “inflation”. The former, inflation, means an increase in the unbacked money supply. The latter, price inflation, means a rise in prices as a result of inflation of the money supply.
Only Austrian economists differentiate the terms, because only Austrians are logical about economics. Everyone else is practicing voodoo. I have to think there is an Austrian, or an Austrian-leaning journalist at Yahoo. The guy’s name is Jared Blikre. I’ll be doing more research on him to see if there’s a mole from our side at the MSM, or if this is just a fluke.
5 thoughts on “The Excess Reserves Problem Actually Makes it Into Yahoo Finance Front Page!”
have you sold CORR?
Nope, I still own it. Dividends have not changed and it’s a dividend play. Yield is up to 20% now. The fact that it is down doesn’t change my opinion on the oil market in general.
I bought like 50$ do save up money. :”> Dollar actually up vs. my national non-EU but Eu member country. Will not sell it, Just my 50 bucks worth of trust in USA’ coin. Vs. Euro that to me is the frailest of them all. Anyway if the bucks run into the museum of coins I’ll have a museum work.
P.S. I don’t know about the gold waste in new dollar bills, coz the band of identification does not contain gold and gold spangled on the bill looks like cheap gold (too yellow, not enough glowing – I could be wrong, just sayin’). For me it’s unthinkable that the US dollar would just be worth nothing. They’re like classics. It’s the euro that’s the new thingie. However science is science and so is mathematics. And so are economics. And thus is life. 🙂
He worked at Russia Today and is part of an ‘Austrian School of Economics’ group on linkedin… The times they are a-changin’
Awesome! I’m going to try to get in contact with him.