Thursday, March 19, 2009

If the ink does not rub off on your butt, it will make good toilet paper

From Disloyal Opposition:

The Federal Reserve says, "to help improve conditions in private credit markets, the Committee decided to purchase up to $300 billion of longer-term Treasury securities over the next six months."

The Wall Street Journal sums that move up nicely: "With rates near zero, the Fed is now essentially printing money to increase the supply of credit in the economy."

Now where's my Econ 101 textbook? I want to see what happens to the value of any given good when you suddenly flood the market with a new supply ...


Shirley Vandever said...

OK, I have a dumb question. Where exactly DOES this money come from?

Steve Newton said...

The same place the Continental Congress got it: from the printing press fairy